Correlation Between Calfrac Well and Enterprise
Can any of the company-specific risk be diversified away by investing in both Calfrac Well and Enterprise 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 Calfrac Well and Enterprise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calfrac Well Services and Enterprise Group, you can compare the effects of market volatilities on Calfrac Well and Enterprise 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 Calfrac Well with a short position of Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calfrac Well and Enterprise.
Diversification Opportunities for Calfrac Well and Enterprise
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Calfrac and Enterprise is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Calfrac Well Services and Enterprise Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enterprise Group and Calfrac Well 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 Calfrac Well Services are associated (or correlated) with Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enterprise Group has no effect on the direction of Calfrac Well i.e., Calfrac Well and Enterprise go up and down completely randomly.
Pair Corralation between Calfrac Well and Enterprise
Assuming the 90 days horizon Calfrac Well Services is expected to under-perform the Enterprise. But the pink sheet apears to be less risky and, when comparing its historical volatility, Calfrac Well Services is 2.34 times less risky than Enterprise. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Enterprise Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 90.00 in Enterprise Group on September 3, 2024 and sell it today you would earn a total of 60.00 from holding Enterprise Group or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calfrac Well Services vs. Enterprise Group
Performance |
| Timeline |
| Calfrac Well Services |
| Enterprise Group |
Calfrac Well and Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calfrac Well and Enterprise
The main advantage of trading using opposite Calfrac Well and Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calfrac Well position performs unexpectedly, Enterprise 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 Enterprise will offset losses from the drop in Enterprise's long position.| Calfrac Well vs. Greenway Technologies | Calfrac Well vs. Akastor ASA | Calfrac Well vs. Auri Inc | Calfrac Well vs. Us Energy Initiative |
| Enterprise vs. Bri Chem Corp | Enterprise vs. High Arctic Energy | Enterprise vs. CES Energy Solutions | Enterprise vs. Mccoy Global |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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