Correlation Between GasLog Partners and Enterprise Products
Can any of the company-specific risk be diversified away by investing in both GasLog Partners and Enterprise Products 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 Enterprise Products 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 Enterprise Products Partners, you can compare the effects of market volatilities on GasLog Partners and Enterprise Products 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 Enterprise Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of GasLog Partners and Enterprise Products.
Diversification Opportunities for GasLog Partners and Enterprise Products
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GasLog and Enterprise is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding GasLog Partners LP and Enterprise Products Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enterprise Products 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 Enterprise Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enterprise Products has no effect on the direction of GasLog Partners i.e., GasLog Partners and Enterprise Products go up and down completely randomly.
Pair Corralation between GasLog Partners and Enterprise Products
Assuming the 90 days trading horizon GasLog Partners is expected to generate 3.6 times less return on investment than Enterprise Products. But when comparing it to its historical volatility, GasLog Partners LP is 2.64 times less risky than Enterprise Products. It trades about 0.15 of its potential returns per unit of risk. Enterprise Products Partners is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 2,887 in Enterprise Products Partners on September 12, 2024 and sell it today you would earn a total of 367.00 from holding Enterprise Products Partners or generate 12.71% 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. Enterprise Products Partners
Performance |
| Timeline |
| GasLog Partners LP |
| Enterprise Products |
GasLog Partners and Enterprise Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GasLog Partners and Enterprise Products
The main advantage of trading using opposite GasLog Partners and Enterprise Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GasLog Partners position performs unexpectedly, Enterprise Products 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 Enterprise Products will offset losses from the drop in Enterprise Products' long position.| GasLog Partners vs. GasLog Partners LP | GasLog Partners vs. Seapeak LLC | GasLog Partners vs. Dynagas LNG Partners | GasLog Partners vs. GasLog Partners LP |
| Enterprise Products vs. MPLX LP | Enterprise Products vs. Kinder Morgan | Enterprise Products vs. ONEOK Inc | Enterprise Products vs. Energy Transfer LP |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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