Correlation Between Cenovus Energy and ProShares MSCI

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

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

Diversification Opportunities for Cenovus Energy and ProShares MSCI

0.69

Correlation Coefficient

Cenovus Energy  ProShares MSCI

Poor diversification

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

Pair Corralation between Cenovus Energy and ProShares MSCI

Considering the 90-day investment horizon Cenovus Energy is expected to generate 3.8 times more return on investment than ProShares MSCI. However, Cenovus Energy is 3.8 times more volatile than ProShares MSCI Emerging. It trades about 0.18 of its potential returns per unit of risk. ProShares MSCI Emerging is currently generating about 0.08 per unit of risk. If you would invest  1,172  in Cenovus Energy on May 6, 2025 and sell it today you would earn a total of  311.00  from holding Cenovus Energy or generate 26.54% return on investment over 90 days.

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

Cenovus Energy  vs.  ProShares MSCI Emerging

Cenovus Energy

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cenovus Energy are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Cenovus Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.

ProShares MSCI Emerging

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ProShares MSCI Emerging are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable fundamental indicators, ProShares MSCI is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Cenovus Energy and ProShares MSCI

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

The idea behind Cenovus Energy and ProShares MSCI Emerging 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.