What Was Schlumberger’s Correlation with Crude Oil on April 13?
In this part, we’ll analyze the correlation between Schlumberger’s (SLB) stock prices and West Texas Intermediate (or WTI) crude oil’s price. The correlation coefficient between the stock’s price and crude oil’s price measures the statistical relationship between the two variables. A correlation coefficient value of 0 to 1 shows a positive correlation, 0 states no correlation, and -1 to 0 shows an inverse correlation.
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Schlumberger’s correlation with crude oil price
The correlation coefficient between Schlumberger’s (SLB) stock price and crude oil prices from April 13, 2016, to April 13, 2017, is 0.62. This indicates a relatively strong positive relationship between crude oil prices and Schlumberger’s stock.
Correlation between OFS stocks and crude oil
As noted in the graph above, the VanEck Vectors Oil Services ETF’s (OIH) correlation with crude oil since April 2016 is 0.68. OIH is an ETF tracking index of 25 OFS companies.
Baker Hughes’s (BHI) correlation coefficient since March 2016 is 0.52. Since April 2016, the correlation coefficient between the Dow Jones Industrial Average (DJIA-INDEX) and Schlumberger is 0.05.