Correlation Between Firsthand Alternative and Aquila Three
Can any of the company-specific risk be diversified away by investing in both Firsthand Alternative and Aquila Three 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 Firsthand Alternative and Aquila Three into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Firsthand Alternative Energy and Aquila Three Peaks, you can compare the effects of market volatilities on Firsthand Alternative and Aquila Three 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 Firsthand Alternative with a short position of Aquila Three. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firsthand Alternative and Aquila Three.
Diversification Opportunities for Firsthand Alternative and Aquila Three
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Firsthand and Aquila is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Firsthand Alternative Energy and Aquila Three Peaks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquila Three Peaks and Firsthand Alternative 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 Firsthand Alternative Energy are associated (or correlated) with Aquila Three. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquila Three Peaks has no effect on the direction of Firsthand Alternative i.e., Firsthand Alternative and Aquila Three go up and down completely randomly.
Pair Corralation between Firsthand Alternative and Aquila Three
Assuming the 90 days horizon Firsthand Alternative Energy is expected to under-perform the Aquila Three. In addition to that, Firsthand Alternative is 12.79 times more volatile than Aquila Three Peaks. It trades about -0.02 of its total potential returns per unit of risk. Aquila Three Peaks is currently generating about 0.17 per unit of volatility. If you would invest 799.00 in Aquila Three Peaks on September 3, 2024 and sell it today you would earn a total of 25.00 from holding Aquila Three Peaks or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Firsthand Alternative Energy vs. Aquila Three Peaks
Performance |
| Timeline |
| Firsthand Alternative |
| Aquila Three Peaks |
Firsthand Alternative and Aquila Three Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Firsthand Alternative and Aquila Three
The main advantage of trading using opposite Firsthand Alternative and Aquila Three positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firsthand Alternative position performs unexpectedly, Aquila Three 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 Aquila Three will offset losses from the drop in Aquila Three's long position.| Firsthand Alternative vs. Guinness Atkinson Alternative | Firsthand Alternative vs. Calvert Global Energy | Firsthand Alternative vs. New Alternatives Fund | Firsthand Alternative vs. Shelton Green Alpha |
| Aquila Three vs. Firsthand Alternative Energy | Aquila Three vs. Goehring Rozencwajg Resources | Aquila Three vs. Hennessy Bp Energy | Aquila Three vs. Calvert Global 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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