Correlation Between TechnipFMC PLC and Enerflex
Can any of the company-specific risk be diversified away by investing in both TechnipFMC PLC and Enerflex 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 TechnipFMC PLC and Enerflex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TechnipFMC PLC and Enerflex, you can compare the effects of market volatilities on TechnipFMC PLC and Enerflex 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 TechnipFMC PLC with a short position of Enerflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of TechnipFMC PLC and Enerflex.
Diversification Opportunities for TechnipFMC PLC and Enerflex
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TechnipFMC and Enerflex is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding TechnipFMC PLC and Enerflex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enerflex and TechnipFMC PLC 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 TechnipFMC PLC are associated (or correlated) with Enerflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enerflex has no effect on the direction of TechnipFMC PLC i.e., TechnipFMC PLC and Enerflex go up and down completely randomly.
Pair Corralation between TechnipFMC PLC and Enerflex
Considering the 90-day investment horizon TechnipFMC PLC is expected to generate 0.76 times more return on investment than Enerflex. However, TechnipFMC PLC is 1.31 times less risky than Enerflex. It trades about 0.1 of its potential returns per unit of risk. Enerflex is currently generating about 0.05 per unit of risk. If you would invest 1,176 in TechnipFMC PLC on August 27, 2024 and sell it today you would earn a total of 1,907 from holding TechnipFMC PLC or generate 162.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TechnipFMC PLC vs. Enerflex
Performance |
| Timeline |
| TechnipFMC PLC |
| Enerflex |
TechnipFMC PLC and Enerflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TechnipFMC PLC and Enerflex
The main advantage of trading using opposite TechnipFMC PLC and Enerflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TechnipFMC PLC position performs unexpectedly, Enerflex 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 Enerflex will offset losses from the drop in Enerflex's long position.| TechnipFMC PLC vs. Oceaneering International | TechnipFMC PLC vs. NOV Inc | TechnipFMC PLC vs. Flowserve | TechnipFMC PLC vs. Core Laboratories NV |
| Enerflex vs. Natural Gas Services | Enerflex vs. Archrock | Enerflex vs. Geospace Technologies | Enerflex vs. Newpark Resources |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |