Correlation Between Ameresco and Quanta Services
Can any of the company-specific risk be diversified away by investing in both Ameresco and Quanta Services 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 Ameresco and Quanta Services into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ameresco and Quanta Services, you can compare the effects of market volatilities on Ameresco and Quanta Services 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 Ameresco with a short position of Quanta Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ameresco and Quanta Services.
Diversification Opportunities for Ameresco and Quanta Services
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ameresco and Quanta is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Ameresco and Quanta Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quanta Services and Ameresco 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 Ameresco are associated (or correlated) with Quanta Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quanta Services has no effect on the direction of Ameresco i.e., Ameresco and Quanta Services go up and down completely randomly.
Pair Corralation between Ameresco and Quanta Services
Given the investment horizon of 90 days Ameresco is expected to under-perform the Quanta Services. In addition to that, Ameresco is 4.34 times more volatile than Quanta Services. It trades about -0.04 of its total potential returns per unit of risk. Quanta Services is currently generating about 0.47 per unit of volatility. If you would invest 30,163 in Quanta Services on September 1, 2024 and sell it today you would earn a total of 4,289 from holding Quanta Services or generate 14.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ameresco vs. Quanta Services
Performance |
| Timeline |
| Ameresco |
| Quanta Services |
Ameresco and Quanta Services Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ameresco and Quanta Services
The main advantage of trading using opposite Ameresco and Quanta Services positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ameresco position performs unexpectedly, Quanta Services 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 Quanta Services will offset losses from the drop in Quanta Services' long position.The idea behind Ameresco and Quanta Services pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Quanta Services vs. MYR Group | Quanta Services vs. Dycom Industries | Quanta Services vs. EMCOR Group | Quanta Services vs. Comfort Systems USA |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |