Correlation Between Ensign Energy and Crombie Real
Can any of the company-specific risk be diversified away by investing in both Ensign Energy and Crombie Real 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 Ensign Energy and Crombie Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ensign Energy Services and Crombie Real Estate, you can compare the effects of market volatilities on Ensign Energy and Crombie Real 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 Ensign Energy with a short position of Crombie Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ensign Energy and Crombie Real.
Diversification Opportunities for Ensign Energy and Crombie Real
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ensign and Crombie is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Ensign Energy Services and Crombie Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crombie Real Estate and Ensign Energy 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 Ensign Energy Services are associated (or correlated) with Crombie Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crombie Real Estate has no effect on the direction of Ensign Energy i.e., Ensign Energy and Crombie Real go up and down completely randomly.
Pair Corralation between Ensign Energy and Crombie Real
Assuming the 90 days trading horizon Ensign Energy Services is expected to under-perform the Crombie Real. In addition to that, Ensign Energy is 4.25 times more volatile than Crombie Real Estate. It trades about -0.05 of its total potential returns per unit of risk. Crombie Real Estate is currently generating about -0.18 per unit of volatility. If you would invest 1,452 in Crombie Real Estate on September 12, 2024 and sell it today you would lose (40.00) from holding Crombie Real Estate or give up 2.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ensign Energy Services vs. Crombie Real Estate
Performance |
| Timeline |
| Ensign Energy Services |
| Crombie Real Estate |
Ensign Energy and Crombie Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ensign Energy and Crombie Real
The main advantage of trading using opposite Ensign Energy and Crombie Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ensign Energy position performs unexpectedly, Crombie Real 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 Crombie Real will offset losses from the drop in Crombie Real's long position.| Ensign Energy vs. Precision Drilling | Ensign Energy vs. Trican Well Service | Ensign Energy vs. Calfrac Well Services | Ensign Energy vs. NuVista Energy |
| Crombie Real vs. Artis Real Estate | Crombie Real vs. Choice Properties Real | Crombie Real vs. Killam Apartment Real | Crombie Real vs. Boardwalk Real Estate |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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