Correlation Between TC Energy and MCAN Mortgage
Can any of the company-specific risk be diversified away by investing in both TC Energy and MCAN Mortgage 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 TC Energy and MCAN Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TC Energy Corp and MCAN Mortgage, you can compare the effects of market volatilities on TC Energy and MCAN Mortgage 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 TC Energy with a short position of MCAN Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of TC Energy and MCAN Mortgage.
Diversification Opportunities for TC Energy and MCAN Mortgage
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between TRP and MCAN is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding TC Energy Corp and MCAN Mortgage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCAN Mortgage and TC Energy 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 TC Energy Corp are associated (or correlated) with MCAN Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCAN Mortgage has no effect on the direction of TC Energy i.e., TC Energy and MCAN Mortgage go up and down completely randomly.
Pair Corralation between TC Energy and MCAN Mortgage
Assuming the 90 days trading horizon TC Energy Corp is expected to under-perform the MCAN Mortgage. But the stock apears to be less risky and, when comparing its historical volatility, TC Energy Corp is 1.1 times less risky than MCAN Mortgage. The stock trades about -0.11 of its potential returns per unit of risk. The MCAN Mortgage is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,866 in MCAN Mortgage on November 29, 2024 and sell it today you would earn a total of 14.00 from holding MCAN Mortgage or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TC Energy Corp vs. MCAN Mortgage
Performance |
| Timeline |
| TC Energy Corp |
| MCAN Mortgage |
TC Energy and MCAN Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TC Energy and MCAN Mortgage
The main advantage of trading using opposite TC Energy and MCAN Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TC Energy position performs unexpectedly, MCAN Mortgage 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 MCAN Mortgage will offset losses from the drop in MCAN Mortgage's long position.| TC Energy vs. Enbridge | TC Energy vs. BCE Inc | TC Energy vs. Fortis Inc | TC Energy vs. Pembina Pipeline Corp |
| MCAN Mortgage vs. Timbercreek Financial Corp | MCAN Mortgage vs. Atrium Mortgage Investment | MCAN Mortgage vs. Firm Capital Mortgage | MCAN Mortgage vs. First National Financial |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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