Correlations in the past week
As we discussed in Part 1 of this series, Southwestern Energy’s (SWN) stock price fell almost 7% for the week ending December 15. Even natural gas (UGAZ) (DGAZ) (UNG) prices fell ~5.8%. So, it’s obvious that Southwestern Energy stock followed natural gas prices last week. In this part, we’ll discuss the correlation between Southwestern Energy and natural gas prices.
For the week ending December 15, Southwestern Energy stock had a very high correlation of ~92% with the natural gas (UNG) (DGAZ). In other words, volatility in natural gas prices impacted Southwestern Energy’s stock price most of the days last week. It’s also in line with Southwestern Energy’s production mix, which contains almost ~90% natural gas.
For the week ending December 15, Southwestern Energy’s correlation with crude oil (USO) (SCO) and the SPDR S&P 500 ETF (SPY) was at ~37% and -39%. It means that Southwestern Energy’s stock price wasn’t impacted by the movements in crude oil (USO) and the SPDR S&P 500 ETF (SPY).
Correlations in the past month
Read Which Energy Stocks Could Be Sensitive to Oil Prices? to learn more about which upstream stocks are sensitive to natural gas prices.