Correlation Between AquaBounty Technologies and Global Clean
Can any of the company-specific risk be diversified away by investing in both AquaBounty Technologies 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 AquaBounty Technologies and Global Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AquaBounty Technologies and Global Clean Energy, you can compare the effects of market volatilities on AquaBounty Technologies 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 AquaBounty Technologies with a short position of Global Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of AquaBounty Technologies and Global Clean.
Diversification Opportunities for AquaBounty Technologies and Global Clean
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between AquaBounty and Global is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding AquaBounty Technologies 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 AquaBounty Technologies 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 AquaBounty Technologies 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 AquaBounty Technologies i.e., AquaBounty Technologies and Global Clean go up and down completely randomly.
Pair Corralation between AquaBounty Technologies and Global Clean
Considering the 90-day investment horizon AquaBounty Technologies is expected to under-perform the Global Clean. But the stock apears to be less risky and, when comparing its historical volatility, AquaBounty Technologies is 1.16 times less risky than Global Clean. The stock trades about -0.02 of its potential returns per unit of risk. The Global Clean Energy is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 91.00 in Global Clean Energy on August 25, 2024 and sell it today you would lose (4.00) from holding Global Clean Energy or give up 4.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
AquaBounty Technologies vs. Global Clean Energy
Performance |
| Timeline |
| AquaBounty Technologies |
| Global Clean Energy |
AquaBounty Technologies and Global Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AquaBounty Technologies and Global Clean
The main advantage of trading using opposite AquaBounty Technologies and Global Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AquaBounty Technologies 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.| AquaBounty Technologies vs. Atlantic Sapphire ASA | AquaBounty Technologies vs. Local Bounti Corp | AquaBounty Technologies vs. Forafric Global PLC | AquaBounty Technologies vs. Forafric Global PLC |
| Global Clean vs. Embotelladora Andina SA | Global Clean vs. Signet International Holdings | Global Clean vs. National Beverage Corp | Global Clean vs. PT Astra 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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