Correlation Between Westshore Terminals and Emera Pref
Can any of the company-specific risk be diversified away by investing in both Westshore Terminals and Emera Pref 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 Westshore Terminals and Emera Pref into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westshore Terminals Investment and Emera Pref A, you can compare the effects of market volatilities on Westshore Terminals and Emera Pref 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 Westshore Terminals with a short position of Emera Pref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westshore Terminals and Emera Pref.
Diversification Opportunities for Westshore Terminals and Emera Pref
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Westshore and Emera is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Westshore Terminals Investment and Emera Pref A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emera Pref A and Westshore Terminals 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 Westshore Terminals Investment are associated (or correlated) with Emera Pref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emera Pref A has no effect on the direction of Westshore Terminals i.e., Westshore Terminals and Emera Pref go up and down completely randomly.
Pair Corralation between Westshore Terminals and Emera Pref
Assuming the 90 days trading horizon Westshore Terminals is expected to generate 1.55 times less return on investment than Emera Pref. In addition to that, Westshore Terminals is 1.52 times more volatile than Emera Pref A. It trades about 0.02 of its total potential returns per unit of risk. Emera Pref A is currently generating about 0.05 per unit of volatility. If you would invest 1,291 in Emera Pref A on September 26, 2024 and sell it today you would earn a total of 324.00 from holding Emera Pref A or generate 25.1% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Westshore Terminals Investment vs. Emera Pref A
Performance |
Timeline |
Westshore Terminals |
Emera Pref A |
Westshore Terminals and Emera Pref Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Westshore Terminals and Emera Pref
The main advantage of trading using opposite Westshore Terminals and Emera Pref positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westshore Terminals position performs unexpectedly, Emera Pref 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 Emera Pref will offset losses from the drop in Emera Pref's long position.Westshore Terminals vs. Goodfellow | Westshore Terminals vs. Leons Furniture Limited | Westshore Terminals vs. High Liner Foods | Westshore Terminals vs. Exco Technologies Limited |
Emera Pref vs. Algonquin Power Utilities | Emera Pref vs. Westshore Terminals Investment | Emera Pref vs. Converge Technology Solutions | Emera Pref vs. Bip Investment Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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