Correlation Between GasLog Partners and Pembina Pipeline
Can any of the company-specific risk be diversified away by investing in both GasLog Partners and Pembina Pipeline 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 GasLog Partners and Pembina Pipeline into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GasLog Partners LP and Pembina Pipeline Corp, you can compare the effects of market volatilities on GasLog Partners and Pembina Pipeline 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 GasLog Partners with a short position of Pembina Pipeline. Check out your portfolio center. Please also check ongoing floating volatility patterns of GasLog Partners and Pembina Pipeline.
Diversification Opportunities for GasLog Partners and Pembina Pipeline
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GasLog and Pembina is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding GasLog Partners LP and Pembina Pipeline Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pembina Pipeline Corp and GasLog Partners 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 GasLog Partners LP are associated (or correlated) with Pembina Pipeline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pembina Pipeline Corp has no effect on the direction of GasLog Partners i.e., GasLog Partners and Pembina Pipeline go up and down completely randomly.
Pair Corralation between GasLog Partners and Pembina Pipeline
Assuming the 90 days trading horizon GasLog Partners LP is expected to under-perform the Pembina Pipeline. But the preferred stock apears to be less risky and, when comparing its historical volatility, GasLog Partners LP is 2.27 times less risky than Pembina Pipeline. The preferred stock trades about -0.08 of its potential returns per unit of risk. The Pembina Pipeline Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 4,261 in Pembina Pipeline Corp on August 24, 2024 and sell it today you would earn a total of 56.00 from holding Pembina Pipeline Corp or generate 1.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GasLog Partners LP vs. Pembina Pipeline Corp
Performance |
| Timeline |
| GasLog Partners LP |
| Pembina Pipeline Corp |
GasLog Partners and Pembina Pipeline Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GasLog Partners and Pembina Pipeline
The main advantage of trading using opposite GasLog Partners and Pembina Pipeline positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GasLog Partners position performs unexpectedly, Pembina Pipeline 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 Pembina Pipeline will offset losses from the drop in Pembina Pipeline's long position.| GasLog Partners vs. GasLog Partners LP | GasLog Partners vs. Dynagas LNG Partners | GasLog Partners vs. NGL Energy Partners | GasLog Partners vs. Seapeak LLC |
| Pembina Pipeline vs. LTC Properties | Pembina Pipeline vs. Main Street Capital | Pembina Pipeline vs. STAG Industrial | Pembina Pipeline vs. Gladstone Investment |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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