Correlation Between Enbridge Pref and Cameco Corp
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By analyzing existing cross correlation between Enbridge Pref L and Cameco Corp, you can compare the effects of market volatilities on Enbridge Pref and Cameco Corp 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 Enbridge Pref with a short position of Cameco Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Cameco Corp.
Diversification Opportunities for Enbridge Pref and Cameco Corp
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Enbridge and Cameco is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref L and Cameco Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cameco Corp and Enbridge Pref 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 Enbridge Pref L are associated (or correlated) with Cameco Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cameco Corp has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Cameco Corp go up and down completely randomly.
Pair Corralation between Enbridge Pref and Cameco Corp
Assuming the 90 days trading horizon Enbridge Pref is expected to generate 22.27 times less return on investment than Cameco Corp. But when comparing it to its historical volatility, Enbridge Pref L is 3.12 times less risky than Cameco Corp. It trades about 0.03 of its potential returns per unit of risk. Cameco Corp is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 7,664 in Cameco Corp on August 27, 2024 and sell it today you would earn a total of 737.00 from holding Cameco Corp or generate 9.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Enbridge Pref L vs. Cameco Corp
Performance |
| Timeline |
| Enbridge Pref L |
| Cameco Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
Enbridge Pref and Cameco Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Cameco Corp
The main advantage of trading using opposite Enbridge Pref and Cameco Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Cameco Corp 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 Cameco Corp will offset losses from the drop in Cameco Corp's long position.| Enbridge Pref vs. Canso Select Opportunities | Enbridge Pref vs. Computer Modelling Group | Enbridge Pref vs. Verizon Communications CDR | Enbridge Pref vs. Data Communications Management |
| Cameco Corp vs. Denison Mines Corp | Cameco Corp vs. Barrick Gold Corp | Cameco Corp vs. First Quantum Minerals | Cameco Corp vs. Kinross Gold Corp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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