Correlation Between Endeavour Silver and Enbridge H

Can any of the company-specific risk be diversified away by investing in both Endeavour Silver and Enbridge H 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 Endeavour Silver and Enbridge H into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Endeavour Silver Corp and Enbridge H Cum, you can compare the effects of market volatilities on Endeavour Silver and Enbridge H 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 Endeavour Silver with a short position of Enbridge H. Check out your portfolio center. Please also check ongoing floating volatility patterns of Endeavour Silver and Enbridge H.

Diversification Opportunities for Endeavour Silver and Enbridge H

-0.58

Correlation Coefficient

Endeavour Silver  Enbridge H

Excellent diversification

The 3 months correlation between Endeavour and Enbridge is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Silver Corp and Enbridge H Cum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enbridge H Cum and Endeavour Silver 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 Endeavour Silver Corp are associated (or correlated) with Enbridge H. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enbridge H Cum has no effect on the direction of Endeavour Silver i.e., Endeavour Silver and Enbridge H go up and down completely randomly.

Pair Corralation between Endeavour Silver and Enbridge H

Assuming the 90 days trading horizon Endeavour Silver Corp is expected to generate 8.6 times more return on investment than Enbridge H. However, Endeavour Silver is 8.6 times more volatile than Enbridge H Cum. It trades about 0.02 of its potential returns per unit of risk. Enbridge H Cum is currently generating about 0.09 per unit of risk. If you would invest  580.00  in Endeavour Silver Corp on October 4, 2024 and sell it today you would lose (5.00) from holding Endeavour Silver Corp or give up 0.86% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Endeavour Silver Corp  vs.  Enbridge H Cum

Endeavour Silver Corp

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Endeavour Silver Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Endeavour Silver is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Enbridge H Cum

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Enbridge H Cum are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, Enbridge H is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Endeavour Silver and Enbridge H

The main advantage of trading using opposite Endeavour Silver and Enbridge H positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Endeavour Silver position performs unexpectedly, Enbridge H 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 Enbridge H will offset losses from the drop in Enbridge H's long position.

The idea behind Endeavour Silver Corp and Enbridge H Cum pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.