Correlation Between Armada Hflr and ORMAT TECHNOLOGIES
Can any of the company-specific risk be diversified away by investing in both Armada Hflr and ORMAT TECHNOLOGIES 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 Armada Hflr and ORMAT TECHNOLOGIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Armada Hflr Pr and ORMAT TECHNOLOGIES, you can compare the effects of market volatilities on Armada Hflr and ORMAT TECHNOLOGIES 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 Armada Hflr with a short position of ORMAT TECHNOLOGIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and ORMAT TECHNOLOGIES.
Diversification Opportunities for Armada Hflr and ORMAT TECHNOLOGIES
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Armada and ORMAT is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and ORMAT TECHNOLOGIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ORMAT TECHNOLOGIES and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with ORMAT TECHNOLOGIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ORMAT TECHNOLOGIES has no effect on the direction of Armada Hflr i.e., Armada Hflr and ORMAT TECHNOLOGIES go up and down completely randomly.
Pair Corralation between Armada Hflr and ORMAT TECHNOLOGIES
Considering the 90-day investment horizon Armada Hflr Pr is expected to generate 0.9 times more return on investment than ORMAT TECHNOLOGIES. However, Armada Hflr Pr is 1.11 times less risky than ORMAT TECHNOLOGIES. It trades about 0.0 of its potential returns per unit of risk. ORMAT TECHNOLOGIES is currently generating about -0.01 per unit of risk. If you would invest 1,068 in Armada Hflr Pr on October 7, 2024 and sell it today you would lose (48.00) from holding Armada Hflr Pr or give up 4.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.8% |
| Values | Daily Returns |
Armada Hflr Pr vs. ORMAT TECHNOLOGIES
Performance |
| Timeline |
| Armada Hflr Pr |
| ORMAT TECHNOLOGIES |
Armada Hflr and ORMAT TECHNOLOGIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Armada Hflr and ORMAT TECHNOLOGIES
The main advantage of trading using opposite Armada Hflr and ORMAT TECHNOLOGIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Armada Hflr position performs unexpectedly, ORMAT TECHNOLOGIES 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 ORMAT TECHNOLOGIES will offset losses from the drop in ORMAT TECHNOLOGIES's long position.| Armada Hflr vs. Modiv Inc | Armada Hflr vs. NexPoint Diversified Real | Armada Hflr vs. Essential Properties Realty | Armada Hflr vs. Broadstone Net Lease |
| ORMAT TECHNOLOGIES vs. The Yokohama Rubber | ORMAT TECHNOLOGIES vs. Broadwind | ORMAT TECHNOLOGIES vs. Plastic Omnium | ORMAT TECHNOLOGIES vs. TEXAS ROADHOUSE |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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