Correlation Between BlackBerry and Enbridge
Can any of the company-specific risk be diversified away by investing in both BlackBerry and Enbridge 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 BlackBerry and Enbridge into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackBerry and Enbridge, you can compare the effects of market volatilities on BlackBerry and Enbridge 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 BlackBerry with a short position of Enbridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackBerry and Enbridge.
Diversification Opportunities for BlackBerry and Enbridge
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BlackBerry and Enbridge is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding BlackBerry and Enbridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enbridge and BlackBerry 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 BlackBerry are associated (or correlated) with Enbridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enbridge has no effect on the direction of BlackBerry i.e., BlackBerry and Enbridge go up and down completely randomly.
Pair Corralation between BlackBerry and Enbridge
Assuming the 90 days horizon BlackBerry is expected to generate 15.96 times less return on investment than Enbridge. In addition to that, BlackBerry is 4.13 times more volatile than Enbridge. It trades about 0.0 of its total potential returns per unit of risk. Enbridge is currently generating about 0.26 per unit of volatility. If you would invest 4,825 in Enbridge on August 29, 2024 and sell it today you would earn a total of 1,189 from holding Enbridge or generate 24.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackBerry vs. Enbridge
Performance |
| Timeline |
| BlackBerry |
| Enbridge |
BlackBerry and Enbridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackBerry and Enbridge
The main advantage of trading using opposite BlackBerry and Enbridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackBerry position performs unexpectedly, Enbridge 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 Enbridge will offset losses from the drop in Enbridge's long position.| BlackBerry vs. Air Canada | BlackBerry vs. Lightspeed Commerce | BlackBerry vs. Shopify | BlackBerry vs. Suncor Energy |
| Enbridge vs. Suncor Energy | Enbridge vs. Toronto Dominion Bank | Enbridge vs. Bank of Nova | Enbridge vs. BCE Inc |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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