Correlation Between Enbridge Pref and ROK Resources
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By analyzing existing cross correlation between Enbridge Pref 5 and ROK Resources, you can compare the effects of market volatilities on Enbridge Pref and ROK 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 ROK Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and ROK Resources.
Diversification Opportunities for Enbridge Pref and ROK Resources
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Enbridge and ROK is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 5 and ROK Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROK 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 ROK Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROK Resources has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and ROK Resources go up and down completely randomly.
Pair Corralation between Enbridge Pref and ROK Resources
Assuming the 90 days trading horizon Enbridge Pref 5 is expected to generate 0.09 times more return on investment than ROK Resources. However, Enbridge Pref 5 is 10.65 times less risky than ROK Resources. It trades about 0.21 of its potential returns per unit of risk. ROK Resources is currently generating about -0.05 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 40.00 from holding Enbridge Pref 5 or generate 1.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enbridge Pref 5 vs. ROK Resources
Performance |
| Timeline |
| Enbridge Pref 5 |
| ROK Resources |
Enbridge Pref and ROK Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and ROK Resources
The main advantage of trading using opposite Enbridge Pref and ROK Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, ROK 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 ROK Resources will offset losses from the drop in ROK Resources' long position.The idea behind Enbridge Pref 5 and ROK 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.| ROK Resources vs. Silver Buckle Mines | ROK Resources vs. TVI Pacific | ROK Resources vs. Trigon Metals | ROK Resources vs. Mountain Boy Minerals |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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