Correlation Between HP and TRANSCANADA
Specify exactly 2 symbols:
By analyzing existing cross correlation between HP Inc and TRANSCANADA PIPELINES LTD, you can compare the effects of market volatilities on HP and TRANSCANADA 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 HP with a short position of TRANSCANADA. Check out your portfolio center. Please also check ongoing floating volatility patterns of HP and TRANSCANADA.
Diversification Opportunities for HP and TRANSCANADA
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HP and TRANSCANADA is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding HP Inc and TRANSCANADA PIPELINES LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRANSCANADA PIPELINES LTD and HP 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 HP Inc are associated (or correlated) with TRANSCANADA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRANSCANADA PIPELINES LTD has no effect on the direction of HP i.e., HP and TRANSCANADA go up and down completely randomly.
Pair Corralation between HP and TRANSCANADA
Considering the 90-day investment horizon HP Inc is expected to generate 2.32 times more return on investment than TRANSCANADA. However, HP is 2.32 times more volatile than TRANSCANADA PIPELINES LTD. It trades about 0.1 of its potential returns per unit of risk. TRANSCANADA PIPELINES LTD is currently generating about 0.11 per unit of risk. If you would invest 3,688 in HP Inc on August 26, 2024 and sell it today you would earn a total of 125.00 from holding HP Inc or generate 3.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 86.36% |
| Values | Daily Returns |
HP Inc vs. TRANSCANADA PIPELINES LTD
Performance |
| Timeline |
| HP Inc |
| TRANSCANADA PIPELINES LTD |
HP and TRANSCANADA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HP and TRANSCANADA
The main advantage of trading using opposite HP and TRANSCANADA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HP position performs unexpectedly, TRANSCANADA 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 TRANSCANADA will offset losses from the drop in TRANSCANADA's long position.The idea behind HP Inc and TRANSCANADA PIPELINES LTD pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| TRANSCANADA vs. The Coca Cola | TRANSCANADA vs. JPMorgan Chase Co | TRANSCANADA vs. Dupont De Nemours | TRANSCANADA vs. Alcoa Corp |
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 Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |