Correlation Between Enbridge Pref and Topaz Energy
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By analyzing existing cross correlation between Enbridge Pref 5 and Topaz Energy Corp, you can compare the effects of market volatilities on Enbridge Pref and Topaz 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 Topaz Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Topaz Energy.
Diversification Opportunities for Enbridge Pref and Topaz Energy
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Enbridge and Topaz is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 5 and Topaz Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Topaz Energy Corp 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 Topaz Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Topaz Energy Corp has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Topaz Energy go up and down completely randomly.
Pair Corralation between Enbridge Pref and Topaz Energy
Assuming the 90 days trading horizon Enbridge Pref is expected to generate 3.79 times less return on investment than Topaz Energy. But when comparing it to its historical volatility, Enbridge Pref 5 is 3.24 times less risky than Topaz Energy. It trades about 0.25 of its potential returns per unit of risk. Topaz Energy Corp is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 2,721 in Topaz Energy Corp on August 25, 2024 and sell it today you would earn a total of 214.00 from holding Topaz Energy Corp or generate 7.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Enbridge Pref 5 vs. Topaz Energy Corp
Performance |
| Timeline |
| Enbridge Pref 5 |
| Topaz Energy Corp |
Enbridge Pref and Topaz Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Topaz Energy
The main advantage of trading using opposite Enbridge Pref and Topaz Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Topaz 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 Topaz Energy will offset losses from the drop in Topaz 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 |
| Topaz Energy vs. Headwater Exploration | Topaz Energy vs. Tamarack Valley Energy | Topaz Energy vs. Freehold Royalties | Topaz Energy vs. Tourmaline Oil 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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