uploads///Correlation

What’s Schlumberger’s Correlation with Crude Oil?

By

Apr. 10 2017, Updated 7:36 a.m. ET

Correlation coefficient

In this article, we’ll analyze the correlation between Schlumberger’s (SLB) stock price and West Texas Intermediate (or WTI) crude oil’s price. 

The correlation coefficient between SLB’s and crude oil’s prices measures the statistical relationship between the two variables. A correlation coefficient of 0 to 1 shows a positive correlation, 0 shows no correlation, and -1 to 0 shows an inverse correlation.

Article continues below advertisement

Schlumberger’s correlation with crude oil’s price

The correlation coefficient between Schlumberger’s stock price and crude oil’s price from April 5, 2016, to April 5, 2017, was 0.63. This indicated a relatively strong positive relationship between crude oil and Schlumberger stock.

Peer comparison

As we can see in the graph above, the VanEck Vectors Oil Services ETF’s (OIH) correlation with crude oil since April 2016 is 0.72. OIH is an ETF tracking an index of 25 oilfield equipment and services companies.

CARBO Ceramics’ (CRR) correlation coefficient since April 2016 is 0.45, while Core Laboratories’ (CLB) correlation coefficient since April 2016 is 0.57. Precision Drilling’s (PDS) correlation coefficient for the same period is ~0.65.

We’ll discuss Schlumberger’s implied volatility in the next article.

Advertisement

More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.