Correlation Between Bloom Energy and Alfen NV
Can any of the company-specific risk be diversified away by investing in both Bloom Energy and Alfen NV 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 Bloom Energy and Alfen NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloom Energy and Alfen NV, you can compare the effects of market volatilities on Bloom Energy and Alfen NV 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 Bloom Energy with a short position of Alfen NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Alfen NV.
Diversification Opportunities for Bloom Energy and Alfen NV
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bloom and Alfen is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy and Alfen NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfen NV and Bloom 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 Bloom Energy are associated (or correlated) with Alfen NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfen NV has no effect on the direction of Bloom Energy i.e., Bloom Energy and Alfen NV go up and down completely randomly.
Pair Corralation between Bloom Energy and Alfen NV
Assuming the 90 days horizon Bloom Energy is expected to under-perform the Alfen NV. In addition to that, Bloom Energy is 1.02 times more volatile than Alfen NV. It trades about 0.0 of its total potential returns per unit of risk. Alfen NV is currently generating about 0.16 per unit of volatility. If you would invest 1,262 in Alfen NV on October 12, 2024 and sell it today you would earn a total of 108.00 from holding Alfen NV or generate 8.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloom Energy vs. Alfen NV
Performance |
| Timeline |
| Bloom Energy |
| Alfen NV |
Bloom Energy and Alfen NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloom Energy and Alfen NV
The main advantage of trading using opposite Bloom Energy and Alfen NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, Alfen NV 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 Alfen NV will offset losses from the drop in Alfen NV's long position.| Bloom Energy vs. Delta Electronics Public | Bloom Energy vs. Superior Plus Corp | Bloom Energy vs. NMI Holdings | Bloom Energy vs. SIVERS SEMICONDUCTORS AB |
| Alfen NV vs. Carnegie Clean Energy | Alfen NV vs. ALERION CLEANPOWER | Alfen NV vs. Broadcom | Alfen NV vs. Clean Energy Fuels |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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