Correlation Between Enbridge and Energean Oil
Can any of the company-specific risk be diversified away by investing in both Enbridge and Energean Oil 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 Enbridge and Energean Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enbridge and Energean Oil Gas, you can compare the effects of market volatilities on Enbridge and Energean Oil 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 Enbridge with a short position of Energean Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge and Energean Oil.
Diversification Opportunities for Enbridge and Energean Oil
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Enbridge and Energean is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge and Energean Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energean Oil Gas and Enbridge 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 Enbridge are associated (or correlated) with Energean Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energean Oil Gas has no effect on the direction of Enbridge i.e., Enbridge and Energean Oil go up and down completely randomly.
Pair Corralation between Enbridge and Energean Oil
Assuming the 90 days trading horizon Enbridge is expected to generate 0.45 times more return on investment than Energean Oil. However, Enbridge is 2.24 times less risky than Energean Oil. It trades about 0.25 of its potential returns per unit of risk. Energean Oil Gas is currently generating about 0.07 per unit of risk. If you would invest 5,937 in Enbridge on October 20, 2024 and sell it today you would earn a total of 423.00 from holding Enbridge or generate 7.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 68.29% |
| Values | Daily Returns |
Enbridge vs. Energean Oil Gas
Performance |
| Timeline |
| Enbridge |
| Energean Oil Gas |
Enbridge and Energean Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge and Energean Oil
The main advantage of trading using opposite Enbridge and Energean Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge position performs unexpectedly, Energean Oil 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 Energean Oil will offset losses from the drop in Energean Oil's long position.| Enbridge vs. Catalyst Media Group | Enbridge vs. Bloomsbury Publishing Plc | Enbridge vs. JD Sports Fashion | Enbridge vs. Host Hotels Resorts |
| Energean Oil vs. Zoom Video Communications | Energean Oil vs. Enbridge | Energean Oil vs. Endo International PLC | Energean Oil vs. Somero Enterprise |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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