Correlation Between Vantage Drilling and PHX Energy

Can any of the company-specific risk be diversified away by investing in both Vantage Drilling and PHX 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 Vantage Drilling and PHX Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vantage Drilling and PHX Energy Services, you can compare the effects of market volatilities on Vantage Drilling and PHX 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 Vantage Drilling with a short position of PHX Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vantage Drilling and PHX Energy.

Diversification Opportunities for Vantage Drilling and PHX Energy

0.0

Correlation Coefficient

Vantage Drilling  PHX Energy

Pay attention - limited upside

The 3 months correlation between Vantage and PHX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Vantage Drilling and PHX Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHX Energy Services and Vantage Drilling 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 Vantage Drilling are associated (or correlated) with PHX Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHX Energy Services has no effect on the direction of Vantage Drilling i.e., Vantage Drilling and PHX Energy go up and down completely randomly.

Pair Corralation between Vantage Drilling and PHX Energy

If you would invest  535.00  in PHX Energy Services on May 3, 2025 and sell it today you would earn a total of  84.00  from holding PHX Energy Services or generate 15.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Vantage Drilling  vs.  PHX Energy Services

Vantage Drilling

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vantage Drilling has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Vantage Drilling is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

PHX Energy Services

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PHX Energy Services are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical indicators, PHX Energy reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vantage Drilling and PHX Energy

The main advantage of trading using opposite Vantage Drilling and PHX Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vantage Drilling position performs unexpectedly, PHX 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 PHX Energy will offset losses from the drop in PHX Energy's long position.

The idea behind Vantage Drilling and PHX Energy Services 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.

Check out your portfolio center.

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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .