Correlation Between Teekay and Ur Energy

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

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

Diversification Opportunities for Teekay and Ur Energy

-0.37

Correlation Coefficient

Teekay  Ur Energy

Very good diversification

The 3 months correlation between Teekay and URG is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Teekay and Ur Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ur Energy and Teekay 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 Teekay are associated (or correlated) with Ur Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ur Energy has no effect on the direction of Teekay i.e., Teekay and Ur Energy go up and down completely randomly.

Pair Corralation between Teekay and Ur Energy

Allowing for the 90-day total investment horizon Teekay is expected to generate 0.63 times more return on investment than Ur Energy. However, Teekay is 1.58 times less risky than Ur Energy. It trades about 0.06 of its potential returns per unit of risk. Ur Energy is currently generating about -0.16 per unit of risk. If you would invest  642.00  in Teekay on November 28, 2024 and sell it today you would earn a total of  41.00  from holding Teekay or generate 6.39% return on investment over 90 days.

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

Teekay  vs.  Ur Energy

Teekay

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Teekay are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite weak forward-looking signals, Teekay may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Ur Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ur Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Teekay and Ur Energy

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

The idea behind Teekay and Ur Energy 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.