Correlation Between Enbridge Pref and Petrus Resources
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By analyzing existing cross correlation between Enbridge Pref L and Petrus Resources, you can compare the effects of market volatilities on Enbridge Pref and Petrus Resources 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 Petrus Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Petrus Resources.
Diversification Opportunities for Enbridge Pref and Petrus Resources
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Enbridge and Petrus is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref L and Petrus Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrus Resources 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 Petrus Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrus Resources has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Petrus Resources go up and down completely randomly.
Pair Corralation between Enbridge Pref and Petrus Resources
Assuming the 90 days trading horizon Enbridge Pref L is expected to generate 0.54 times more return on investment than Petrus Resources. However, Enbridge Pref L is 1.85 times less risky than Petrus Resources. It trades about 0.2 of its potential returns per unit of risk. Petrus Resources is currently generating about -0.02 per unit of risk. If you would invest 2,181 in Enbridge Pref L on September 1, 2024 and sell it today you would earn a total of 65.00 from holding Enbridge Pref L or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Enbridge Pref L vs. Petrus Resources
Performance |
| Timeline |
| Enbridge Pref L |
| Petrus Resources |
Enbridge Pref and Petrus Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Petrus Resources
The main advantage of trading using opposite Enbridge Pref and Petrus Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Petrus Resources 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 Petrus Resources will offset losses from the drop in Petrus Resources' long position.The idea behind Enbridge Pref L and Petrus Resources 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.| Petrus Resources vs. InPlay Oil Corp | Petrus Resources vs. Yangarra Resources | Petrus Resources vs. Pine Cliff 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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