Correlation Between Canadian Natural and Enerplus
Can any of the company-specific risk be diversified away by investing in both Canadian Natural 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 Canadian Natural and Enerplus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Canadian Natural Resources and Enerplus, you can compare the effects of market volatilities on Canadian Natural 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 Canadian Natural with a short position of Enerplus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Natural and Enerplus.
Diversification Opportunities for Canadian Natural and Enerplus
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Canadian and Enerplus is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Natural Resources and Enerplus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enerplus and Canadian Natural 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 Canadian Natural Resources 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 Canadian Natural i.e., Canadian Natural and Enerplus go up and down completely randomly.
Pair Corralation between Canadian Natural and Enerplus
If you would invest 1,627 in Enerplus on August 24, 2024 and sell it today you would earn a total of 0.00 from holding Enerplus or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Canadian Natural Resources vs. Enerplus
Performance |
| Timeline |
| Canadian Natural Res |
| Enerplus |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Canadian Natural and Enerplus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canadian Natural and Enerplus
The main advantage of trading using opposite Canadian Natural and Enerplus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian Natural 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.| Canadian Natural vs. Baytex Energy Corp | Canadian Natural vs. Vermilion Energy | Canadian Natural vs. Obsidian Energy | Canadian Natural 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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