Correlation Between AppHarvest and Global Clean
Can any of the company-specific risk be diversified away by investing in both AppHarvest and Global Clean 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 AppHarvest and Global Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AppHarvest and Global Clean Energy, you can compare the effects of market volatilities on AppHarvest and Global Clean 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 AppHarvest with a short position of Global Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of AppHarvest and Global Clean.
Diversification Opportunities for AppHarvest and Global Clean
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AppHarvest and Global is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding AppHarvest and Global Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Clean Energy and AppHarvest 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 AppHarvest are associated (or correlated) with Global Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Clean Energy has no effect on the direction of AppHarvest i.e., AppHarvest and Global Clean go up and down completely randomly.
Pair Corralation between AppHarvest and Global Clean
Given the investment horizon of 90 days AppHarvest is expected to under-perform the Global Clean. In addition to that, AppHarvest is 1.62 times more volatile than Global Clean Energy. It trades about -0.07 of its total potential returns per unit of risk. Global Clean Energy is currently generating about 0.03 per unit of volatility. If you would invest 129.00 in Global Clean Energy on August 31, 2024 and sell it today you would lose (30.00) from holding Global Clean Energy or give up 23.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 28.51% |
| Values | Daily Returns |
AppHarvest vs. Global Clean Energy
Performance |
| Timeline |
| AppHarvest |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Global Clean Energy |
AppHarvest and Global Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AppHarvest and Global Clean
The main advantage of trading using opposite AppHarvest and Global Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AppHarvest position performs unexpectedly, Global Clean 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 Global Clean will offset losses from the drop in Global Clean's long position.| AppHarvest vs. Porch Group | AppHarvest vs. Hydrofarm Holdings Group | AppHarvest vs. Danimer Scientific | AppHarvest vs. Open Lending Corp |
| Global Clean vs. Edible Garden AG | Global Clean vs. Golden Agri Resources | Global Clean vs. Local Bounti Corp | Global Clean vs. Village Farms International |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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