Correlation Between Broadwind and Vestas Wind
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By analyzing existing cross correlation between Broadwind and Vestas Wind Systems, you can compare the effects of market volatilities on Broadwind and Vestas Wind 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 Broadwind with a short position of Vestas Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Broadwind and Vestas Wind.
Diversification Opportunities for Broadwind and Vestas Wind
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Broadwind and Vestas is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Broadwind and Vestas Wind Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vestas Wind Systems and Broadwind 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 Broadwind are associated (or correlated) with Vestas Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vestas Wind Systems has no effect on the direction of Broadwind i.e., Broadwind and Vestas Wind go up and down completely randomly.
Pair Corralation between Broadwind and Vestas Wind
Assuming the 90 days trading horizon Broadwind is expected to generate 1.84 times more return on investment than Vestas Wind. However, Broadwind is 1.84 times more volatile than Vestas Wind Systems. It trades about 0.01 of its potential returns per unit of risk. Vestas Wind Systems is currently generating about -0.07 per unit of risk. If you would invest 198.00 in Broadwind on September 4, 2024 and sell it today you would lose (25.00) from holding Broadwind or give up 12.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Broadwind vs. Vestas Wind Systems
Performance |
| Timeline |
| Broadwind |
| Vestas Wind Systems |
Broadwind and Vestas Wind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Broadwind and Vestas Wind
The main advantage of trading using opposite Broadwind and Vestas Wind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Broadwind position performs unexpectedly, Vestas Wind 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 Vestas Wind will offset losses from the drop in Vestas Wind's long position.| Broadwind vs. MINCO SILVER | Broadwind vs. Ming Le Sports | Broadwind vs. GRIFFIN MINING LTD | Broadwind vs. CI GAMES SA |
| Vestas Wind vs. SIEMENS AG SP | Vestas Wind vs. Siemens Aktiengesellschaft | Vestas Wind vs. Siemens Aktiengesellschaft | Vestas Wind vs. Atlas Copco A |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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