Correlation Between Excelerate Energy and Imperial Oil
Can any of the company-specific risk be diversified away by investing in both Excelerate Energy and Imperial Oil 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 Excelerate Energy and Imperial Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excelerate Energy and Imperial Oil, you can compare the effects of market volatilities on Excelerate Energy and Imperial Oil 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 Excelerate Energy with a short position of Imperial Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excelerate Energy and Imperial Oil.
Diversification Opportunities for Excelerate Energy and Imperial Oil
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Excelerate and Imperial is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Excelerate Energy and Imperial Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imperial Oil and Excelerate 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 Excelerate Energy are associated (or correlated) with Imperial Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imperial Oil has no effect on the direction of Excelerate Energy i.e., Excelerate Energy and Imperial Oil go up and down completely randomly.
Pair Corralation between Excelerate Energy and Imperial Oil
Allowing for the 90-day total investment horizon Excelerate Energy is expected to generate 1.51 times more return on investment than Imperial Oil. However, Excelerate Energy is 1.51 times more volatile than Imperial Oil. It trades about 0.12 of its potential returns per unit of risk. Imperial Oil is currently generating about 0.05 per unit of risk. If you would invest 1,402 in Excelerate Energy on November 9, 2024 and sell it today you would earn a total of 1,590 from holding Excelerate Energy or generate 113.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Excelerate Energy vs. Imperial Oil
Performance |
| Timeline |
| Excelerate Energy |
| Imperial Oil |
Excelerate Energy and Imperial Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excelerate Energy and Imperial Oil
The main advantage of trading using opposite Excelerate Energy and Imperial Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excelerate Energy position performs unexpectedly, Imperial Oil 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 Imperial Oil will offset losses from the drop in Imperial Oil's long position.| Excelerate Energy vs. Clearway Energy | Excelerate Energy vs. Brookfield Renewable Corp | Excelerate Energy vs. Nextera Energy Partners | Excelerate Energy vs. Brookfield Renewable Partners |
| Imperial Oil vs. Suncor Energy | Imperial Oil vs. Ecopetrol SA ADR | Imperial Oil vs. Petroleo Brasileiro Petrobras | Imperial Oil vs. Equinor ASA ADR |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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