Correlation Between Guardian Investment and Ninepoint Energy

Can any of the company-specific risk be diversified away by investing in both Guardian Investment and Ninepoint 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 Guardian Investment and Ninepoint Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guardian Investment Grade and Ninepoint Energy, you can compare the effects of market volatilities on Guardian Investment and Ninepoint 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 Guardian Investment with a short position of Ninepoint Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guardian Investment and Ninepoint Energy.

Diversification Opportunities for Guardian Investment and Ninepoint Energy

0.69

Correlation Coefficient

Guardian Investment  Ninepoint Energy

Poor diversification

The 3 months correlation between Guardian and Ninepoint is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Guardian Investment Grade and Ninepoint Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ninepoint Energy and Guardian Investment 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 Guardian Investment Grade are associated (or correlated) with Ninepoint Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ninepoint Energy has no effect on the direction of Guardian Investment i.e., Guardian Investment and Ninepoint Energy go up and down completely randomly.

Pair Corralation between Guardian Investment and Ninepoint Energy

Assuming the 90 days trading horizon Guardian Investment is expected to generate 7.14 times less return on investment than Ninepoint Energy. But when comparing it to its historical volatility, Guardian Investment Grade is 10.61 times less risky than Ninepoint Energy. It trades about 0.14 of its potential returns per unit of risk. Ninepoint Energy is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  2,370  in Ninepoint Energy on April 25, 2025 and sell it today you would earn a total of  176.00  from holding Ninepoint Energy or generate 7.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Guardian Investment Grade  vs.  Ninepoint Energy

Guardian Investment Grade

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guardian Investment Grade are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of very healthy basic indicators, Guardian Investment is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Ninepoint Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ninepoint Energy are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat unfluctuating basic indicators, Ninepoint Energy may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Guardian Investment and Ninepoint Energy

The main advantage of trading using opposite Guardian Investment and Ninepoint Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardian Investment position performs unexpectedly, Ninepoint 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 Ninepoint Energy will offset losses from the drop in Ninepoint Energy's long position.

The idea behind Guardian Investment Grade and Ninepoint Energy 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.

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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 Global Correlations module to find global opportunities by holding instruments from different markets.