Correlation Between Baytex Energy and Enerplus
Can any of the company-specific risk be diversified away by investing in both Baytex Energy and Enerplus 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 Baytex Energy and Enerplus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baytex Energy Corp and Enerplus, you can compare the effects of market volatilities on Baytex Energy and Enerplus 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 Baytex Energy with a short position of Enerplus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baytex Energy and Enerplus.
Diversification Opportunities for Baytex Energy and Enerplus
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Baytex and Enerplus is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Baytex Energy Corp and Enerplus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enerplus and Baytex Energy 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 Baytex Energy Corp are associated (or correlated) with Enerplus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enerplus has no effect on the direction of Baytex Energy i.e., Baytex Energy and Enerplus go up and down completely randomly.
Pair Corralation between Baytex Energy and Enerplus
If you would invest 293.00 in Baytex Energy Corp on August 23, 2024 and sell it today you would earn a total of 9.00 from holding Baytex Energy Corp or generate 3.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Baytex Energy Corp vs. Enerplus
Performance |
| Timeline |
| Baytex Energy Corp |
| Enerplus |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Baytex Energy and Enerplus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baytex Energy and Enerplus
The main advantage of trading using opposite Baytex Energy and Enerplus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baytex Energy position performs unexpectedly, Enerplus 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 Enerplus will offset losses from the drop in Enerplus' long position.| Baytex Energy vs. Vermilion Energy | Baytex Energy vs. Obsidian Energy | Baytex Energy vs. Canadian Natural Resources | Baytex Energy vs. Ovintiv |
| Enerplus vs. Vermilion Energy | Enerplus vs. Canadian Natural Resources | Enerplus vs. Baytex Energy Corp | Enerplus vs. Obsidian Energy |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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