In this article, we’ll analyze the correlation between Flotek Industries’ (FTK) stock price and West Texas Intermediate (or WTI) crude oil’s price.
The correlation coefficient between FTK’s and crude oil’s prices 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.
How related are Flotek Industries’ and crude oil’s prices?
The correlation coefficient between Flotek Industries’ stock price and crude oil’s price from August 2015 to the present is 0.38. This indicates a relatively low positive relationship between crude oil prices and FTK’s stock.
Correlation between FTK’s stock and crude oil
As noted in the table above, Flotek Industries’ correlation coefficient with crude oil has risen significantly from the end of 2Q16 to August 9 compared to the past year.
By comparison, the VanEck Vectors Oil Services ETF’s (OIH) correlation with crude oil has risen since July 1 compared to its correlation coefficient from a year ago. Nabors Industries’ (NBR) correlation coefficient since July 1 is higher than FTK’s.
Next, we’ll discuss Flotek Industries’ returns versus the industry indicators.