Correlation Between AFC Energy and Axion Power
Can any of the company-specific risk be diversified away by investing in both AFC Energy and Axion Power 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 AFC Energy and Axion Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AFC Energy plc and Axion Power International, you can compare the effects of market volatilities on AFC Energy and Axion Power 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 AFC Energy with a short position of Axion Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of AFC Energy and Axion Power.
Diversification Opportunities for AFC Energy and Axion Power
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AFC and Axion is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AFC Energy plc and Axion Power International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axion Power International and AFC 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 AFC Energy plc are associated (or correlated) with Axion Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axion Power International has no effect on the direction of AFC Energy i.e., AFC Energy and Axion Power go up and down completely randomly.
Pair Corralation between AFC Energy and Axion Power
If you would invest 0.01 in Axion Power International on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Axion Power International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 8.69% |
| Values | Daily Returns |
AFC Energy plc vs. Axion Power International
Performance |
| Timeline |
| AFC Energy plc |
| Axion Power International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
AFC Energy and Axion Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AFC Energy and Axion Power
The main advantage of trading using opposite AFC Energy and Axion Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AFC Energy position performs unexpectedly, Axion Power 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 Axion Power will offset losses from the drop in Axion Power's long position.| AFC Energy vs. FREYR Battery SA | AFC Energy vs. nVent Electric PLC | AFC Energy vs. Hubbell | AFC Energy vs. Advanced Energy Industries |
| Axion Power vs. AFC Energy plc | Axion Power vs. ADS TEC ENERGY PLC | Axion Power vs. ABB | Axion Power vs. Ads Tec Energy |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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