Correlation Between Ensign Energy and Unit
Can any of the company-specific risk be diversified away by investing in both Ensign Energy and Unit 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 Ensign Energy and Unit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ensign Energy Services and Unit Corporation, you can compare the effects of market volatilities on Ensign Energy and Unit 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 Ensign Energy with a short position of Unit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ensign Energy and Unit.
Diversification Opportunities for Ensign Energy and Unit
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ensign and Unit is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ensign Energy Services and Unit Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unit and Ensign Energy 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 Ensign Energy Services are associated (or correlated) with Unit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unit has no effect on the direction of Ensign Energy i.e., Ensign Energy and Unit go up and down completely randomly.
Pair Corralation between Ensign Energy and Unit
Assuming the 90 days horizon Ensign Energy is expected to generate 1.6 times less return on investment than Unit. In addition to that, Ensign Energy is 1.65 times more volatile than Unit Corporation. It trades about 0.02 of its total potential returns per unit of risk. Unit Corporation is currently generating about 0.06 per unit of volatility. If you would invest 2,514 in Unit Corporation on September 1, 2025 and sell it today you would earn a total of 875.00 from holding Unit Corporation or generate 34.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ensign Energy Services vs. Unit Corp.
Performance |
| Timeline |
| Ensign Energy Services |
| Unit |
Ensign Energy and Unit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ensign Energy and Unit
The main advantage of trading using opposite Ensign Energy and Unit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ensign Energy position performs unexpectedly, Unit 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 Unit will offset losses from the drop in Unit's long position.| Ensign Energy vs. Yuexiu Transport Infrastructure | Ensign Energy vs. Roadrunner Transportation Systems | Ensign Energy vs. JB Hunt Transport | Ensign Energy vs. China Clean Energy |
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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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