Correlation Between Enbridge Pref and EnCore Energy

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

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

Diversification Opportunities for Enbridge Pref and EnCore Energy

0.0

Correlation Coefficient

Enbridge Pref  EnCore Energy

Pay attention - limited upside

The 3 months correlation between Enbridge and EnCore is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Enbridge Pref L and enCore Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on enCore Energy Corp and Enbridge Pref 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 Enbridge Pref L are associated (or correlated) with EnCore Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of enCore Energy Corp has no effect on the direction of Enbridge Pref i.e., Enbridge Pref and EnCore Energy go up and down completely randomly.

Pair Corralation between Enbridge Pref and EnCore Energy

If you would invest  2,215  in Enbridge Pref L on October 4, 2024 and sell it today you would earn a total of  45.00  from holding Enbridge Pref L or generate 2.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Enbridge Pref L  vs.  enCore Energy Corp

Enbridge Pref L

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Enbridge Pref L has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Enbridge Pref is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

enCore Energy Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days enCore Energy Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, EnCore Energy is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Enbridge Pref and EnCore Energy

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

The idea behind Enbridge Pref L and enCore Energy Corp 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.