Correlation Between Pembina Pipeline and Mccoy Global

Can any of the company-specific risk be diversified away by investing in both Pembina Pipeline and Mccoy Global 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 Pembina Pipeline and Mccoy Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pembina Pipeline Corp and Mccoy Global, you can compare the effects of market volatilities on Pembina Pipeline and Mccoy Global 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 Mccoy Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pembina Pipeline and Mccoy Global.

Diversification Opportunities for Pembina Pipeline and Mccoy Global

-0.11

Correlation Coefficient

Pembina Pipeline  Mccoy Global

Good diversification

The 3 months correlation between Pembina and Mccoy is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Pembina Pipeline Corp and Mccoy Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mccoy Global 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 Mccoy Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mccoy Global has no effect on the direction of Pembina Pipeline i.e., Pembina Pipeline and Mccoy Global go up and down completely randomly.

Pair Corralation between Pembina Pipeline and Mccoy Global

Assuming the 90 days trading horizon Pembina Pipeline Corp is expected to under-perform the Mccoy Global. But the preferred stock apears to be less risky and, when comparing its historical volatility, Pembina Pipeline Corp is 6.57 times less risky than Mccoy Global. The preferred stock trades about -0.02 of its potential returns per unit of risk. The Mccoy Global is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  276.00  in Mccoy Global on December 22, 2024 and sell it today you would earn a total of  53.00  from holding Mccoy Global or generate 19.2% return on investment over 90 days.

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

Pembina Pipeline Corp  vs.  Mccoy Global

Pembina Pipeline Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pembina Pipeline Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong essential indicators, Pembina Pipeline is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Mccoy Global

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mccoy Global are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental drivers, Mccoy Global displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pembina Pipeline and Mccoy Global

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

The idea behind Pembina Pipeline Corp and Mccoy Global 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.