Correlation Between Baker Hughes and Enbridge Energy
Can any of the company-specific risk be diversified away by investing in both Baker Hughes and Enbridge 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 Baker Hughes and Enbridge Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baker Hughes and Enbridge Energy Partners, you can compare the effects of market volatilities on Baker Hughes and Enbridge 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 Baker Hughes with a short position of Enbridge Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baker Hughes and Enbridge Energy.
Diversification Opportunities for Baker Hughes and Enbridge Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baker and Enbridge is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Baker Hughes and Enbridge Energy Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enbridge Energy Partners and Baker Hughes 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 Baker Hughes are associated (or correlated) with Enbridge Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enbridge Energy Partners has no effect on the direction of Baker Hughes i.e., Baker Hughes and Enbridge Energy go up and down completely randomly.
Pair Corralation between Baker Hughes and Enbridge Energy
If you would invest (100.00) in Enbridge Energy Partners on January 18, 2024 and sell it today you would earn a total of 100.00 from holding Enbridge Energy Partners or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Baker Hughes vs. Enbridge Energy Partners
Performance |
Timeline |
Baker Hughes |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Enbridge Energy Partners |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Baker Hughes and Enbridge Energy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Baker Hughes and Enbridge Energy
The main advantage of trading using opposite Baker Hughes and Enbridge Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baker Hughes position performs unexpectedly, Enbridge 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 Enbridge Energy will offset losses from the drop in Enbridge Energy's long position.Baker Hughes vs. Tradeweb Markets | Baker Hughes vs. Par Pacific Holdings | Baker Hughes vs. Casio Computer Co | Baker Hughes vs. Arhaus Inc |
Enbridge Energy vs. Dine Brands Global | Enbridge Energy vs. Arhaus Inc | Enbridge Energy vs. Portillos | Enbridge Energy vs. Aspen Aerogels |
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 Stocks Directory module to find actively traded stocks across global markets.
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