Correlation Between AltShares Trust and Crescent Energy

Can any of the company-specific risk be diversified away by investing in both AltShares Trust and Crescent Energy at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining AltShares Trust and Crescent Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AltShares Trust and Crescent Energy Co, you can compare the effects of market volatilities on AltShares Trust and Crescent Energy and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in AltShares Trust with a short position of Crescent Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of AltShares Trust and Crescent Energy.

Diversification Opportunities for AltShares Trust and Crescent Energy

0.12

Correlation Coefficient

AltShares Trust  Crescent Energy

Average diversification

The 3 months correlation between AltShares and Crescent is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding AltShares Trust and Crescent Energy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crescent Energy and AltShares Trust is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on AltShares Trust are associated (or correlated) with Crescent Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crescent Energy has no effect on the direction of AltShares Trust i.e., AltShares Trust and Crescent Energy go up and down completely randomly.

Pair Corralation between AltShares Trust and Crescent Energy

Considering the 90-day investment horizon AltShares Trust is expected to generate 16.64 times less return on investment than Crescent Energy. But when comparing it to its historical volatility, AltShares Trust is 19.7 times less risky than Crescent Energy. It trades about 0.23 of its potential returns per unit of risk. Crescent Energy Co is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  799.00  in Crescent Energy Co on February 20, 2025 and sell it today you would earn a total of  98.00  from holding Crescent Energy Co or generate 12.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

AltShares Trust   vs.  Crescent Energy Co

AltShares Trust

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in AltShares Trust are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, AltShares Trust is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Crescent Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Crescent Energy Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's technical and fundamental indicators remain fairly strong which may send shares a bit higher in June 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with AltShares Trust and Crescent Energy

The main advantage of trading using opposite AltShares Trust and Crescent Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AltShares Trust position performs unexpectedly, Crescent Energy can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Crescent Energy will offset losses from the drop in Crescent Energy's long position.

The idea behind AltShares Trust and Crescent Energy Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Share Portfolio module to track or share privately all of your investments from the convenience of any device.