Correlation Between Pembina Pipeline and Canadian Utilities
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By analyzing existing cross correlation between Pembina Pipeline Corp and Canadian Utilities Ltd, you can compare the effects of market volatilities on Pembina Pipeline and Canadian Utilities 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 Pembina Pipeline with a short position of Canadian Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pembina Pipeline and Canadian Utilities.
Diversification Opportunities for Pembina Pipeline and Canadian Utilities
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pembina and Canadian is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Pembina Pipeline Corp and Canadian Utilities Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Utilities and Pembina Pipeline 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 Pembina Pipeline Corp are associated (or correlated) with Canadian Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Utilities has no effect on the direction of Pembina Pipeline i.e., Pembina Pipeline and Canadian Utilities go up and down completely randomly.
Pair Corralation between Pembina Pipeline and Canadian Utilities
Assuming the 90 days trading horizon Pembina Pipeline is expected to generate 56.71 times less return on investment than Canadian Utilities. In addition to that, Pembina Pipeline is 1.03 times more volatile than Canadian Utilities Ltd. It trades about 0.0 of its total potential returns per unit of risk. Canadian Utilities Ltd is currently generating about 0.06 per unit of volatility. If you would invest 2,416 in Canadian Utilities Ltd on September 23, 2024 and sell it today you would earn a total of 60.00 from holding Canadian Utilities Ltd or generate 2.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Pembina Pipeline Corp vs. Canadian Utilities Ltd
Performance |
Timeline |
Pembina Pipeline Corp |
Canadian Utilities |
Pembina Pipeline and Canadian Utilities Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pembina Pipeline and Canadian Utilities
The main advantage of trading using opposite Pembina Pipeline and Canadian Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pembina Pipeline position performs unexpectedly, Canadian Utilities 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 Canadian Utilities will offset losses from the drop in Canadian Utilities' long position.Pembina Pipeline vs. Enbridge Pref 5 | Pembina Pipeline vs. Enbridge Pref 11 | Pembina Pipeline vs. Enbridge Pref L | Pembina Pipeline vs. E Split Corp |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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