Correlation Between Pembina Pipeline and Keyera Corp
Can any of the company-specific risk be diversified away by investing in both Pembina Pipeline and Keyera Corp 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 Keyera Corp 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 Keyera Corp, you can compare the effects of market volatilities on Pembina Pipeline and Keyera Corp 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 Keyera Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pembina Pipeline and Keyera Corp.
Diversification Opportunities for Pembina Pipeline and Keyera Corp
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Pembina and Keyera is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Pembina Pipeline Corp and Keyera Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keyera Corp 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 Keyera Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keyera Corp has no effect on the direction of Pembina Pipeline i.e., Pembina Pipeline and Keyera Corp go up and down completely randomly.
Pair Corralation between Pembina Pipeline and Keyera Corp
Assuming the 90 days trading horizon Pembina Pipeline is expected to generate 1.12 times less return on investment than Keyera Corp. But when comparing it to its historical volatility, Pembina Pipeline Corp is 1.31 times less risky than Keyera Corp. It trades about 0.22 of its potential returns per unit of risk. Keyera Corp is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 3,025 in Keyera Corp on August 25, 2024 and sell it today you would earn a total of 1,714 from holding Keyera Corp or generate 56.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pembina Pipeline Corp vs. Keyera Corp
Performance |
| Timeline |
| Pembina Pipeline Corp |
| Keyera Corp |
Pembina Pipeline and Keyera Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pembina Pipeline and Keyera Corp
The main advantage of trading using opposite Pembina Pipeline and Keyera Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pembina Pipeline position performs unexpectedly, Keyera Corp 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 Keyera Corp will offset losses from the drop in Keyera Corp's long position.| Pembina Pipeline vs. Exco Technologies Limited | Pembina Pipeline vs. Air Canada | Pembina Pipeline vs. CVW CleanTech | Pembina Pipeline vs. Arizona Metals Corp |
| Keyera Corp vs. Pembina Pipeline Corp | Keyera Corp vs. Capital Power | Keyera Corp vs. AltaGas | Keyera Corp vs. Canadian Utilities Limited |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |