Correlation Between Brookfield Infrastructure and MDU Resources
Can any of the company-specific risk be diversified away by investing in both Brookfield Infrastructure and MDU Resources 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 Brookfield Infrastructure and MDU Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookfield Infrastructure Corp and MDU Resources Group, you can compare the effects of market volatilities on Brookfield Infrastructure and MDU Resources 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 Brookfield Infrastructure with a short position of MDU Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Infrastructure and MDU Resources.
Diversification Opportunities for Brookfield Infrastructure and MDU Resources
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Brookfield and MDU is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Infrastructure Corp and MDU Resources Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MDU Resources Group and Brookfield Infrastructure 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 Brookfield Infrastructure Corp are associated (or correlated) with MDU Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MDU Resources Group has no effect on the direction of Brookfield Infrastructure i.e., Brookfield Infrastructure and MDU Resources go up and down completely randomly.
Pair Corralation between Brookfield Infrastructure and MDU Resources
Assuming the 90 days trading horizon Brookfield Infrastructure Corp is expected to generate 0.95 times more return on investment than MDU Resources. However, Brookfield Infrastructure Corp is 1.05 times less risky than MDU Resources. It trades about 0.19 of its potential returns per unit of risk. MDU Resources Group is currently generating about 0.13 per unit of risk. If you would invest 5,628 in Brookfield Infrastructure Corp on July 18, 2025 and sell it today you would earn a total of 974.00 from holding Brookfield Infrastructure Corp or generate 17.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 96.88% |
| Values | Daily Returns |
Brookfield Infrastructure Corp vs. MDU Resources Group
Performance |
| Timeline |
| Brookfield Infrastructure |
| MDU Resources Group |
Brookfield Infrastructure and MDU Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brookfield Infrastructure and MDU Resources
The main advantage of trading using opposite Brookfield Infrastructure and MDU Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookfield Infrastructure position performs unexpectedly, MDU Resources 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 MDU Resources will offset losses from the drop in MDU Resources' long position.The idea behind Brookfield Infrastructure Corp and MDU Resources Group 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.
| MDU Resources vs. Valmont Industries | MDU Resources vs. Brookfield Business Partners | MDU Resources vs. Griffon | MDU Resources vs. Matthews International |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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