Correlation Between Enbridge and Colossus Resources
Can any of the company-specific risk be diversified away by investing in both Enbridge and Colossus Resources 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 and Colossus Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enbridge and Colossus Resources Corp, you can compare the effects of market volatilities on Enbridge and Colossus 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 with a short position of Colossus Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enbridge and Colossus Resources.
Diversification Opportunities for Enbridge and Colossus Resources
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Enbridge and Colossus is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge and Colossus Resources Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Colossus Resources Corp and Enbridge 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 are associated (or correlated) with Colossus Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Colossus Resources Corp has no effect on the direction of Enbridge i.e., Enbridge and Colossus Resources go up and down completely randomly.
Pair Corralation between Enbridge and Colossus Resources
Assuming the 90 days trading horizon Enbridge is expected to under-perform the Colossus Resources. But the stock apears to be less risky and, when comparing its historical volatility, Enbridge is 6.04 times less risky than Colossus Resources. The stock trades about -0.13 of its potential returns per unit of risk. The Colossus Resources Corp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 12.00 in Colossus Resources Corp on September 21, 2024 and sell it today you would earn a total of 1.00 from holding Colossus Resources Corp or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Enbridge vs. Colossus Resources Corp
Performance |
| Timeline |
| Enbridge |
| Colossus Resources Corp |
Enbridge and Colossus Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enbridge and Colossus Resources
The main advantage of trading using opposite Enbridge and Colossus Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enbridge position performs unexpectedly, Colossus 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 Colossus Resources will offset losses from the drop in Colossus Resources' long position.| Enbridge vs. Suncor Energy | Enbridge vs. Toronto Dominion Bank | Enbridge vs. Bank of Nova | Enbridge vs. BCE Inc |
| Colossus Resources vs. Datable Technology Corp | Colossus Resources vs. Questor Technology | Colossus Resources vs. HPQ Silicon Resources | Colossus Resources vs. CI Financial 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |