Correlation Between Teekay and SMLP Old
Can any of the company-specific risk be diversified away by investing in both Teekay and SMLP Old 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 Teekay and SMLP Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teekay and SMLP Old, you can compare the effects of market volatilities on Teekay and SMLP Old 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 Teekay with a short position of SMLP Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teekay and SMLP Old.
Diversification Opportunities for Teekay and SMLP Old
Weak diversification
The 3 months correlation between Teekay and SMLP is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Teekay and SMLP Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SMLP Old and Teekay 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 Teekay are associated (or correlated) with SMLP Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SMLP Old has no effect on the direction of Teekay i.e., Teekay and SMLP Old go up and down completely randomly.
Pair Corralation between Teekay and SMLP Old
If you would invest (100.00) in SMLP Old on November 2, 2024 and sell it today you would earn a total of 100.00 from holding SMLP Old or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Teekay vs. SMLP Old
Performance |
| Timeline |
| Teekay |
| SMLP Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Teekay and SMLP Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Teekay and SMLP Old
The main advantage of trading using opposite Teekay and SMLP Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teekay position performs unexpectedly, SMLP Old 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 SMLP Old will offset losses from the drop in SMLP Old's long position.| Teekay vs. Teekay Tankers | Teekay vs. DHT Holdings | Teekay vs. Frontline | Teekay vs. International Seaways |
| SMLP Old vs. Genesis Energy LP | SMLP Old vs. Brooge Holdings | SMLP Old vs. Hess Midstream Partners | SMLP Old vs. DT Midstream |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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