Correlation Between Pembina Pipeline and ATLANTIC PETROLPF
Can any of the company-specific risk be diversified away by investing in both Pembina Pipeline and ATLANTIC PETROLPF 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 Pembina Pipeline and ATLANTIC PETROLPF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pembina Pipeline Corp and ATLANTIC PETROLPF DK, you can compare the effects of market volatilities on Pembina Pipeline and ATLANTIC PETROLPF 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 Pembina Pipeline with a short position of ATLANTIC PETROLPF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pembina Pipeline and ATLANTIC PETROLPF.
Diversification Opportunities for Pembina Pipeline and ATLANTIC PETROLPF
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pembina and ATLANTIC is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Pembina Pipeline Corp and ATLANTIC PETROLPF DK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATLANTIC PETROLPF and Pembina Pipeline 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 Pembina Pipeline Corp are associated (or correlated) with ATLANTIC PETROLPF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATLANTIC PETROLPF has no effect on the direction of Pembina Pipeline i.e., Pembina Pipeline and ATLANTIC PETROLPF go up and down completely randomly.
Pair Corralation between Pembina Pipeline and ATLANTIC PETROLPF
Assuming the 90 days horizon Pembina Pipeline Corp is expected to under-perform the ATLANTIC PETROLPF. But the stock apears to be less risky and, when comparing its historical volatility, Pembina Pipeline Corp is 6.6 times less risky than ATLANTIC PETROLPF. The stock trades about -0.18 of its potential returns per unit of risk. The ATLANTIC PETROLPF DK is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 27.00 in ATLANTIC PETROLPF DK on October 22, 2024 and sell it today you would earn a total of 2.00 from holding ATLANTIC PETROLPF DK or generate 7.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pembina Pipeline Corp vs. ATLANTIC PETROLPF DK
Performance |
| Timeline |
| Pembina Pipeline Corp |
| ATLANTIC PETROLPF |
Pembina Pipeline and ATLANTIC PETROLPF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pembina Pipeline and ATLANTIC PETROLPF
The main advantage of trading using opposite Pembina Pipeline and ATLANTIC PETROLPF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pembina Pipeline position performs unexpectedly, ATLANTIC PETROLPF 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 ATLANTIC PETROLPF will offset losses from the drop in ATLANTIC PETROLPF's long position.| Pembina Pipeline vs. Perseus Mining Limited | Pembina Pipeline vs. SBI Insurance Group | Pembina Pipeline vs. ANGLO ASIAN MINING | Pembina Pipeline vs. Insurance Australia Group |
| ATLANTIC PETROLPF vs. Zijin Mining Group | ATLANTIC PETROLPF vs. Forsys Metals Corp | ATLANTIC PETROLPF vs. TEXAS ROADHOUSE | ATLANTIC PETROLPF vs. Stag Industrial |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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