Correlation Between EnLink Midstream and Antero Midstream
Can any of the company-specific risk be diversified away by investing in both EnLink Midstream and Antero Midstream 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 EnLink Midstream and Antero Midstream into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EnLink Midstream LLC and Antero Midstream Partners, you can compare the effects of market volatilities on EnLink Midstream and Antero Midstream 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 EnLink Midstream with a short position of Antero Midstream. Check out your portfolio center. Please also check ongoing floating volatility patterns of EnLink Midstream and Antero Midstream.
Diversification Opportunities for EnLink Midstream and Antero Midstream
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between EnLink and Antero is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding EnLink Midstream LLC and Antero Midstream Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Antero Midstream Partners and EnLink Midstream 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 EnLink Midstream LLC are associated (or correlated) with Antero Midstream. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Antero Midstream Partners has no effect on the direction of EnLink Midstream i.e., EnLink Midstream and Antero Midstream go up and down completely randomly.
Pair Corralation between EnLink Midstream and Antero Midstream
Given the investment horizon of 90 days EnLink Midstream LLC is expected to generate 0.65 times more return on investment than Antero Midstream. However, EnLink Midstream LLC is 1.55 times less risky than Antero Midstream. It trades about 0.3 of its potential returns per unit of risk. Antero Midstream Partners is currently generating about 0.19 per unit of risk. If you would invest 1,464 in EnLink Midstream LLC on August 24, 2024 and sell it today you would earn a total of 103.00 from holding EnLink Midstream LLC or generate 7.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EnLink Midstream LLC vs. Antero Midstream Partners
Performance |
| Timeline |
| EnLink Midstream LLC |
| Antero Midstream Partners |
EnLink Midstream and Antero Midstream Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EnLink Midstream and Antero Midstream
The main advantage of trading using opposite EnLink Midstream and Antero Midstream positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EnLink Midstream position performs unexpectedly, Antero Midstream 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 Antero Midstream will offset losses from the drop in Antero Midstream's long position.| EnLink Midstream vs. Plains All American | EnLink Midstream vs. Hess Midstream Partners | EnLink Midstream vs. Western Midstream Partners | EnLink Midstream vs. Plains GP Holdings |
| Antero Midstream vs. Western Midstream Partners | Antero Midstream vs. MPLX LP | Antero Midstream vs. Hess Midstream Partners | Antero Midstream vs. Plains All American |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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