Correlation Between Pembina Pipeline and Caseys General
Can any of the company-specific risk be diversified away by investing in both Pembina Pipeline and Caseys General 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 Caseys General 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 Caseys General Stores, you can compare the effects of market volatilities on Pembina Pipeline and Caseys General 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 Caseys General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pembina Pipeline and Caseys General.
Diversification Opportunities for Pembina Pipeline and Caseys General
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pembina and Caseys is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Pembina Pipeline Corp and Caseys General Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caseys General Stores 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 Caseys General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caseys General Stores has no effect on the direction of Pembina Pipeline i.e., Pembina Pipeline and Caseys General go up and down completely randomly.
Pair Corralation between Pembina Pipeline and Caseys General
Assuming the 90 days horizon Pembina Pipeline is expected to generate 2.73 times less return on investment than Caseys General. But when comparing it to its historical volatility, Pembina Pipeline Corp is 1.34 times less risky than Caseys General. It trades about 0.05 of its potential returns per unit of risk. Caseys General Stores is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 20,367 in Caseys General Stores on November 2, 2024 and sell it today you would earn a total of 20,233 from holding Caseys General Stores or generate 99.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Pembina Pipeline Corp vs. Caseys General Stores
Performance |
| Timeline |
| Pembina Pipeline Corp |
| Caseys General Stores |
Pembina Pipeline and Caseys General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pembina Pipeline and Caseys General
The main advantage of trading using opposite Pembina Pipeline and Caseys General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pembina Pipeline position performs unexpectedly, Caseys General 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 Caseys General will offset losses from the drop in Caseys General's long position.| Pembina Pipeline vs. PNC Financial Services | Pembina Pipeline vs. Prosiebensat 1 Media | Pembina Pipeline vs. OAKTRSPECLENDNEW | Pembina Pipeline vs. ANTA SPORTS PRODUCT |
| Caseys General vs. Kingdee International Software | Caseys General vs. PT Steel Pipe | Caseys General vs. Cognizant Technology Solutions | Caseys General vs. DXC Technology Co |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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