Correlation Between Tidewater and Enerflex
Can any of the company-specific risk be diversified away by investing in both Tidewater and Enerflex 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 Tidewater and Enerflex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tidewater and Enerflex, you can compare the effects of market volatilities on Tidewater and Enerflex 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 Tidewater with a short position of Enerflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidewater and Enerflex.
Diversification Opportunities for Tidewater and Enerflex
Pay attention - limited upside
The 3 months correlation between Tidewater and Enerflex is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Tidewater and Enerflex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enerflex and Tidewater 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 Tidewater are associated (or correlated) with Enerflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enerflex has no effect on the direction of Tidewater i.e., Tidewater and Enerflex go up and down completely randomly.
Pair Corralation between Tidewater and Enerflex
Considering the 90-day investment horizon Tidewater is expected to generate 2.8 times less return on investment than Enerflex. But when comparing it to its historical volatility, Tidewater is 1.05 times less risky than Enerflex. It trades about 0.02 of its potential returns per unit of risk. Enerflex is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 590.00 in Enerflex on August 31, 2024 and sell it today you would earn a total of 325.00 from holding Enerflex or generate 55.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tidewater vs. Enerflex
Performance |
| Timeline |
| Tidewater |
| Enerflex |
Tidewater and Enerflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tidewater and Enerflex
The main advantage of trading using opposite Tidewater and Enerflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidewater position performs unexpectedly, Enerflex 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 Enerflex will offset losses from the drop in Enerflex's long position.| Tidewater vs. Weatherford International PLC | Tidewater vs. NOV Inc | Tidewater vs. Liberty Oilfield Services | Tidewater vs. TechnipFMC PLC |
| Enerflex vs. Now Inc | Enerflex vs. Bristow Group | Enerflex vs. Helix Energy Solutions | Enerflex vs. Oceaneering International |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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