Correlation Between Enbridge Pref and Gear Energy
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By analyzing existing cross correlation between Enbridge Pref 5 and Gear Energy, you can compare the effects of market volatilities on Enbridge Pref and Gear 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 Enbridge Pref with a short position of Gear Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Gear Energy.
Diversification Opportunities for Enbridge Pref and Gear Energy
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Enbridge and Gear is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 5 and Gear Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gear Energy 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 5 are associated (or correlated) with Gear Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gear Energy has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Gear Energy go up and down completely randomly.
Pair Corralation between Enbridge Pref and Gear Energy
Assuming the 90 days trading horizon Enbridge Pref 5 is expected to generate 0.8 times more return on investment than Gear Energy. However, Enbridge Pref 5 is 1.26 times less risky than Gear Energy. It trades about 0.04 of its potential returns per unit of risk. Gear Energy is currently generating about -0.03 per unit of risk. If you would invest 1,723 in Enbridge Pref 5 on August 25, 2024 and sell it today you would earn a total of 677.00 from holding Enbridge Pref 5 or generate 39.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.79% |
| Values | Daily Returns |
Enbridge Pref 5 vs. Gear Energy
Performance |
| Timeline |
| Enbridge Pref 5 |
| Gear Energy |
Enbridge Pref and Gear Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Gear Energy
The main advantage of trading using opposite Enbridge Pref and Gear Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Gear 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 Gear Energy will offset losses from the drop in Gear Energy's long position.| Enbridge Pref vs. East Side Games | Enbridge Pref vs. Leons Furniture Limited | Enbridge Pref vs. AGF Management Limited | Enbridge Pref vs. Highwood Asset Management |
| Gear Energy vs. Cardinal Energy | Gear Energy vs. Tamarack Valley Energy | Gear Energy vs. Athabasca Oil Corp | Gear Energy vs. Headwater Exploration |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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