Correlation Between Tucows and Ensign Energy
Can any of the company-specific risk be diversified away by investing in both Tucows and Ensign 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 Tucows and Ensign Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tucows Inc and Ensign Energy Services, you can compare the effects of market volatilities on Tucows and Ensign 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 Tucows with a short position of Ensign Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tucows and Ensign Energy.
Diversification Opportunities for Tucows and Ensign Energy
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Tucows and Ensign is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Tucows Inc and Ensign Energy Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensign Energy Services and Tucows 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 Tucows Inc are associated (or correlated) with Ensign Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensign Energy Services has no effect on the direction of Tucows i.e., Tucows and Ensign Energy go up and down completely randomly.
Pair Corralation between Tucows and Ensign Energy
Assuming the 90 days horizon Tucows Inc is expected to under-perform the Ensign Energy. In addition to that, Tucows is 1.31 times more volatile than Ensign Energy Services. It trades about -0.01 of its total potential returns per unit of risk. Ensign Energy Services is currently generating about 0.0 per unit of volatility. If you would invest 373.00 in Ensign Energy Services on August 24, 2024 and sell it today you would lose (57.00) from holding Ensign Energy Services or give up 15.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tucows Inc vs. Ensign Energy Services
Performance |
| Timeline |
| Tucows Inc |
| Ensign Energy Services |
Tucows and Ensign Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tucows and Ensign Energy
The main advantage of trading using opposite Tucows and Ensign Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tucows position performs unexpectedly, Ensign 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 Ensign Energy will offset losses from the drop in Ensign Energy's long position.| Tucows vs. TECSYS Inc | Tucows vs. Descartes Systems Group | Tucows vs. Enghouse Systems | Tucows vs. Evertz Technologies Limited |
| Ensign Energy vs. Precision Drilling | Ensign Energy vs. Trican Well Service | Ensign Energy vs. Calfrac Well Services | Ensign Energy vs. NuVista Energy |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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