Correlation Between Enbridge Pref and Eco Atlantic
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By analyzing existing cross correlation between Enbridge Pref L and Eco Atlantic Oil, you can compare the effects of market volatilities on Enbridge Pref and Eco Atlantic 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 Eco Atlantic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Eco Atlantic.
Diversification Opportunities for Enbridge Pref and Eco Atlantic
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Enbridge and Eco is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref L and Eco Atlantic Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eco Atlantic Oil 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 Eco Atlantic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eco Atlantic Oil has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Eco Atlantic go up and down completely randomly.
Pair Corralation between Enbridge Pref and Eco Atlantic
Assuming the 90 days trading horizon Enbridge Pref L is expected to generate 0.23 times more return on investment than Eco Atlantic. However, Enbridge Pref L is 4.3 times less risky than Eco Atlantic. It trades about 0.18 of its potential returns per unit of risk. Eco Atlantic Oil is currently generating about -0.07 per unit of risk. If you would invest 2,189 in Enbridge Pref L on September 3, 2024 and sell it today you would earn a total of 57.00 from holding Enbridge Pref L or generate 2.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Enbridge Pref L vs. Eco Atlantic Oil
Performance |
| Timeline |
| Enbridge Pref L |
| Eco Atlantic Oil |
Enbridge Pref and Eco Atlantic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Eco Atlantic
The main advantage of trading using opposite Enbridge Pref and Eco Atlantic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Eco Atlantic 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 Eco Atlantic will offset losses from the drop in Eco Atlantic's long position.The idea behind Enbridge Pref L and Eco Atlantic Oil pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Eco Atlantic vs. CGX Energy | Eco Atlantic vs. Africa Oil Corp | Eco Atlantic vs. Africa Energy Corp | Eco Atlantic vs. Valeura 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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