Correlation Between Enbridge H and Triple Flag
Can any of the company-specific risk be diversified away by investing in both Enbridge H and Triple Flag at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Enbridge H and Triple Flag into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enbridge H Cum and Triple Flag Precious, you can compare the effects of market volatilities on Enbridge H and Triple Flag 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 H with a short position of Triple Flag. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge H and Triple Flag.
Diversification Opportunities for Enbridge H and Triple Flag
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Enbridge and Triple is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge H Cum and Triple Flag Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triple Flag Precious and Enbridge H 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 H Cum are associated (or correlated) with Triple Flag. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triple Flag Precious has no effect on the direction of Enbridge H i.e., Enbridge H and Triple Flag go up and down completely randomly.
Pair Corralation between Enbridge H and Triple Flag
Assuming the 90 days trading horizon Enbridge H is expected to generate 1.1 times less return on investment than Triple Flag. But when comparing it to its historical volatility, Enbridge H Cum is 2.34 times less risky than Triple Flag. It trades about 0.11 of its potential returns per unit of risk. Triple Flag Precious is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,688 in Triple Flag Precious on December 10, 2024 and sell it today you would earn a total of 840.00 from holding Triple Flag Precious or generate 49.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enbridge H Cum vs. Triple Flag Precious
Performance |
| Timeline |
| Enbridge H Cum |
| Triple Flag Precious |
Enbridge H and Triple Flag Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge H and Triple Flag
The main advantage of trading using opposite Enbridge H and Triple Flag positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge H position performs unexpectedly, Triple Flag 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 Triple Flag will offset losses from the drop in Triple Flag's long position.| Enbridge H vs. Nicola Mining | Enbridge H vs. Andlauer Healthcare Gr | Enbridge H vs. Bausch Health Companies | Enbridge H vs. Magna Mining |
| Triple Flag vs. Solution Financial | Triple Flag vs. Definity Financial Corp | Triple Flag vs. CI Financial Corp | Triple Flag vs. Verizon Communications CDR |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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