Correlation Between Enbridge Pref and Journey Energy
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By analyzing existing cross correlation between Enbridge Pref 5 and Journey Energy, you can compare the effects of market volatilities on Enbridge Pref and Journey 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 Journey Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Journey Energy.
Diversification Opportunities for Enbridge Pref and Journey Energy
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Enbridge and Journey is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 5 and Journey Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Journey 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 Journey Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Journey Energy has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Journey Energy go up and down completely randomly.
Pair Corralation between Enbridge Pref and Journey Energy
Assuming the 90 days trading horizon Enbridge Pref 5 is expected to generate 0.13 times more return on investment than Journey Energy. However, Enbridge Pref 5 is 7.63 times less risky than Journey Energy. It trades about 0.28 of its potential returns per unit of risk. Journey Energy is currently generating about -0.04 per unit of risk. If you would invest 2,350 in Enbridge Pref 5 on August 30, 2024 and sell it today you would earn a total of 49.00 from holding Enbridge Pref 5 or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Enbridge Pref 5 vs. Journey Energy
Performance |
| Timeline |
| Enbridge Pref 5 |
| Journey Energy |
Enbridge Pref and Journey Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Journey Energy
The main advantage of trading using opposite Enbridge Pref and Journey Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Journey 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 Journey Energy will offset losses from the drop in Journey Energy's long position.The idea behind Enbridge Pref 5 and Journey Energy 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.| Journey Energy vs. Gear Energy | Journey Energy vs. InPlay Oil Corp | Journey Energy vs. Headwater Exploration | Journey Energy vs. Cardinal 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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