Correlation Between Imperial Oil and Tidewater Midstream
Can any of the company-specific risk be diversified away by investing in both Imperial Oil and Tidewater Midstream 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 Imperial Oil and Tidewater Midstream into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imperial Oil and Tidewater Midstream and, you can compare the effects of market volatilities on Imperial Oil and Tidewater Midstream 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 Imperial Oil with a short position of Tidewater Midstream. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imperial Oil and Tidewater Midstream.
Diversification Opportunities for Imperial Oil and Tidewater Midstream
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Imperial and Tidewater is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Imperial Oil and Tidewater Midstream and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tidewater Midstream and and Imperial Oil 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 Imperial Oil are associated (or correlated) with Tidewater Midstream. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tidewater Midstream and has no effect on the direction of Imperial Oil i.e., Imperial Oil and Tidewater Midstream go up and down completely randomly.
Pair Corralation between Imperial Oil and Tidewater Midstream
Assuming the 90 days trading horizon Imperial Oil is expected to generate 0.38 times more return on investment than Tidewater Midstream. However, Imperial Oil is 2.64 times less risky than Tidewater Midstream. It trades about 0.16 of its potential returns per unit of risk. Tidewater Midstream and is currently generating about 0.02 per unit of risk. If you would invest 12,240 in Imperial Oil on September 1, 2025 and sell it today you would earn a total of 1,730 from holding Imperial Oil or generate 14.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Imperial Oil vs. Tidewater Midstream and
Performance |
| Timeline |
| Imperial Oil |
| Tidewater Midstream and |
Imperial Oil and Tidewater Midstream Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imperial Oil and Tidewater Midstream
The main advantage of trading using opposite Imperial Oil and Tidewater Midstream positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imperial Oil position performs unexpectedly, Tidewater Midstream 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 Tidewater Midstream will offset losses from the drop in Tidewater Midstream's long position.| Imperial Oil vs. Dream Office Real | Imperial Oil vs. Maple Leaf Foods | Imperial Oil vs. American CuMo Mining | Imperial Oil vs. Quipt Home Medical |
| Tidewater Midstream vs. Ramp Metals | Tidewater Midstream vs. Major Drilling Group | Tidewater Midstream vs. Uniserve Communications Corp | Tidewater Midstream vs. VIP Entertainment Technologies |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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