Correlation Between NIKE and Enbridge Pref
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By analyzing existing cross correlation between NIKE Inc CDR and Enbridge Pref 5, you can compare the effects of market volatilities on NIKE and Enbridge Pref 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 NIKE with a short position of Enbridge Pref. Check out your portfolio center. Please also check ongoing floating volatility patterns of NIKE and Enbridge Pref.
Diversification Opportunities for NIKE and Enbridge Pref
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between NIKE and Enbridge is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding NIKE Inc CDR and Enbridge Pref 5 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enbridge Pref 5 and NIKE 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 NIKE Inc CDR are associated (or correlated) with Enbridge Pref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enbridge Pref 5 has no effect on the direction of NIKE i.e., NIKE and Enbridge Pref go up and down completely randomly.
Pair Corralation between NIKE and Enbridge Pref
Assuming the 90 days trading horizon NIKE Inc CDR is expected to under-perform the Enbridge Pref. In addition to that, NIKE is 4.81 times more volatile than Enbridge Pref 5. It trades about -0.04 of its total potential returns per unit of risk. Enbridge Pref 5 is currently generating about 0.23 per unit of volatility. If you would invest 2,357 in Enbridge Pref 5 on August 29, 2024 and sell it today you would earn a total of 42.00 from holding Enbridge Pref 5 or generate 1.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NIKE Inc CDR vs. Enbridge Pref 5
Performance |
| Timeline |
| NIKE Inc CDR |
| Enbridge Pref 5 |
NIKE and Enbridge Pref Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NIKE and Enbridge Pref
The main advantage of trading using opposite NIKE and Enbridge Pref positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NIKE position performs unexpectedly, Enbridge Pref 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 Enbridge Pref will offset losses from the drop in Enbridge Pref's long position.| NIKE vs. Brookfield Office Properties | NIKE vs. Data Communications Management | NIKE vs. Advent Wireless | NIKE vs. Cogeco Communications |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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