Correlation Between Sage Potash and Total Energy
Can any of the company-specific risk be diversified away by investing in both Sage Potash and Total Energy 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 Sage Potash and Total Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sage Potash Corp and Total Energy Services, you can compare the effects of market volatilities on Sage Potash and Total Energy 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 Sage Potash with a short position of Total Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sage Potash and Total Energy.
Diversification Opportunities for Sage Potash and Total Energy
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sage and Total is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Sage Potash Corp and Total Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Energy Services and Sage Potash 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 Sage Potash Corp are associated (or correlated) with Total Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Energy Services has no effect on the direction of Sage Potash i.e., Sage Potash and Total Energy go up and down completely randomly.
Pair Corralation between Sage Potash and Total Energy
Assuming the 90 days trading horizon Sage Potash is expected to generate 1.53 times less return on investment than Total Energy. In addition to that, Sage Potash is 5.36 times more volatile than Total Energy Services. It trades about 0.07 of its total potential returns per unit of risk. Total Energy Services is currently generating about 0.57 per unit of volatility. If you would invest 962.00 in Total Energy Services on September 1, 2024 and sell it today you would earn a total of 206.00 from holding Total Energy Services or generate 21.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sage Potash Corp vs. Total Energy Services
Performance |
| Timeline |
| Sage Potash Corp |
| Total Energy Services |
Sage Potash and Total Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sage Potash and Total Energy
The main advantage of trading using opposite Sage Potash and Total Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sage Potash position performs unexpectedly, Total Energy 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 Total Energy will offset losses from the drop in Total Energy's long position.| Sage Potash vs. Enbridge Pref 5 | Sage Potash vs. Enbridge Pref 11 | Sage Potash vs. Enbridge Pref L | Sage Potash vs. E Split Corp |
| Total Energy vs. Trican Well Service | Total Energy vs. Calfrac Well Services | Total Energy vs. CES Energy Solutions |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| 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 | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |