Correlation Between Enbridge Pref and Element Fleet
Can any of the company-specific risk be diversified away by investing in both Enbridge Pref and Element Fleet 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 Pref and Element Fleet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enbridge Pref 7 and Element Fleet Management, you can compare the effects of market volatilities on Enbridge Pref and Element Fleet 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 Element Fleet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge Pref and Element Fleet.
Diversification Opportunities for Enbridge Pref and Element Fleet
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Enbridge and Element is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref 7 and Element Fleet Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Element Fleet Management 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 7 are associated (or correlated) with Element Fleet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Element Fleet Management has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and Element Fleet go up and down completely randomly.
Pair Corralation between Enbridge Pref and Element Fleet
Assuming the 90 days trading horizon Enbridge Pref 7 is expected to generate 0.45 times more return on investment than Element Fleet. However, Enbridge Pref 7 is 2.23 times less risky than Element Fleet. It trades about 0.48 of its potential returns per unit of risk. Element Fleet Management is currently generating about -0.06 per unit of risk. If you would invest 1,940 in Enbridge Pref 7 on October 23, 2024 and sell it today you would earn a total of 176.00 from holding Enbridge Pref 7 or generate 9.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.5% |
| Values | Daily Returns |
Enbridge Pref 7 vs. Element Fleet Management
Performance |
| Timeline |
| Enbridge Pref 7 |
| Element Fleet Management |
Enbridge Pref and Element Fleet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge Pref and Element Fleet
The main advantage of trading using opposite Enbridge Pref and Element Fleet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge Pref position performs unexpectedly, Element Fleet 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 Element Fleet will offset losses from the drop in Element Fleet's long position.| Enbridge Pref vs. Element Fleet Management | Enbridge Pref vs. IGM Financial | Enbridge Pref vs. Champion Iron | Enbridge Pref vs. Highwood Asset Management |
| Element Fleet vs. ECN Capital Corp | Element Fleet vs. Martinrea International | Element Fleet vs. CCL Industries | Element Fleet vs. FirstService 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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