Correlation Between Enbridge Pref and Parex Resources
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By analyzing existing cross correlation between Enbridge Pref 5 and Parex Resources, you can compare the effects of market volatilities on Enbridge Pref and Parex 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 Parex Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Parex Resources.
Diversification Opportunities for Enbridge Pref and Parex Resources
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Enbridge and Parex is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 5 and Parex Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parex 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 5 are associated (or correlated) with Parex Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parex Resources has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Parex Resources go up and down completely randomly.
Pair Corralation between Enbridge Pref and Parex Resources
Assuming the 90 days trading horizon Enbridge Pref 5 is expected to generate 0.09 times more return on investment than Parex Resources. However, Enbridge Pref 5 is 11.21 times less risky than Parex Resources. It trades about -0.08 of its potential returns per unit of risk. Parex Resources is currently generating about -0.16 per unit of risk. If you would invest 2,400 in Enbridge Pref 5 on September 18, 2024 and sell it today you would lose (8.00) from holding Enbridge Pref 5 or give up 0.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Enbridge Pref 5 vs. Parex Resources
Performance |
| Timeline |
| Enbridge Pref 5 |
| Parex Resources |
Enbridge Pref and Parex Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Parex Resources
The main advantage of trading using opposite Enbridge Pref and Parex Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Parex 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 Parex Resources will offset losses from the drop in Parex Resources' long position.| Enbridge Pref vs. Summa Silver Corp | Enbridge Pref vs. Oculus VisionTech | Enbridge Pref vs. Sparx Technology | Enbridge Pref vs. Northstar Clean Technologies |
| Parex Resources vs. Tourmaline Oil Corp | Parex Resources vs. PrairieSky Royalty | Parex Resources vs. ARC Resources | Parex Resources vs. MEG Energy 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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