Correlation Between Hydrogen Refueling and Emova Group
Can any of the company-specific risk be diversified away by investing in both Hydrogen Refueling and Emova Group 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 Hydrogen Refueling and Emova Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hydrogen Refueling Solutions and Emova Group SA, you can compare the effects of market volatilities on Hydrogen Refueling and Emova Group 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 Hydrogen Refueling with a short position of Emova Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hydrogen Refueling and Emova Group.
Diversification Opportunities for Hydrogen Refueling and Emova Group
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hydrogen and Emova is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Hydrogen Refueling Solutions and Emova Group SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emova Group SA and Hydrogen Refueling 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 Hydrogen Refueling Solutions are associated (or correlated) with Emova Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emova Group SA has no effect on the direction of Hydrogen Refueling i.e., Hydrogen Refueling and Emova Group go up and down completely randomly.
Pair Corralation between Hydrogen Refueling and Emova Group
Assuming the 90 days trading horizon Hydrogen Refueling Solutions is expected to under-perform the Emova Group. In addition to that, Hydrogen Refueling is 1.48 times more volatile than Emova Group SA. It trades about -0.08 of its total potential returns per unit of risk. Emova Group SA is currently generating about -0.02 per unit of volatility. If you would invest 98.00 in Emova Group SA on September 3, 2024 and sell it today you would lose (11.00) from holding Emova Group SA or give up 11.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hydrogen Refueling Solutions vs. Emova Group SA
Performance |
| Timeline |
| Hydrogen Refueling |
| Emova Group SA |
Hydrogen Refueling and Emova Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hydrogen Refueling and Emova Group
The main advantage of trading using opposite Hydrogen Refueling and Emova Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hydrogen Refueling position performs unexpectedly, Emova Group 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 Emova Group will offset losses from the drop in Emova Group's long position.| Hydrogen Refueling vs. Hydrogene De France | Hydrogen Refueling vs. Neoen SA | Hydrogen Refueling vs. Voltalia SA | Hydrogen Refueling vs. OVH Groupe SAS |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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