Correlation Between Canadian Natural and United Energy
Can any of the company-specific risk be diversified away by investing in both Canadian Natural and United Energy 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 United Energy 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 United Energy Group, you can compare the effects of market volatilities on Canadian Natural and United Energy 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 United Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Canadian Natural and United Energy.
Diversification Opportunities for Canadian Natural and United Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Canadian and United is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Canadian Natural Resources and United Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Energy Group 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 United Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Energy Group has no effect on the direction of Canadian Natural i.e., Canadian Natural and United Energy go up and down completely randomly.
Pair Corralation between Canadian Natural and United Energy
If you would invest 4.10 in United Energy Group on November 28, 2024 and sell it today you would earn a total of 0.00 from holding United Energy Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Canadian Natural Resources vs. United Energy Group
Performance |
| Timeline |
| Canadian Natural Res |
| United Energy Group |
Canadian Natural and United Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Canadian Natural and United Energy
The main advantage of trading using opposite Canadian Natural and United Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Canadian Natural position performs unexpectedly, United Energy 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 United Energy will offset losses from the drop in United Energy's long position.| Canadian Natural vs. Baytex Energy Corp | Canadian Natural vs. Vermilion Energy | Canadian Natural vs. Obsidian Energy | Canadian Natural vs. Ovintiv |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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