Correlation Between American Security and Ocean Thermal
Can any of the company-specific risk be diversified away by investing in both American Security and Ocean Thermal 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 American Security and Ocean Thermal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Security Resources and Ocean Thermal Energy, you can compare the effects of market volatilities on American Security and Ocean Thermal 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 American Security with a short position of Ocean Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Security and Ocean Thermal.
Diversification Opportunities for American Security and Ocean Thermal
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Ocean is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Security Resources and Ocean Thermal Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocean Thermal Energy and American Security 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 American Security Resources are associated (or correlated) with Ocean Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocean Thermal Energy has no effect on the direction of American Security i.e., American Security and Ocean Thermal go up and down completely randomly.
Pair Corralation between American Security and Ocean Thermal
If you would invest 0.80 in Ocean Thermal Energy on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Ocean Thermal Energy or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
American Security Resources vs. Ocean Thermal Energy
Performance |
| Timeline |
| American Security |
| Ocean Thermal Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Security and Ocean Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Security and Ocean Thermal
The main advantage of trading using opposite American Security and Ocean Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Security position performs unexpectedly, Ocean Thermal 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 Ocean Thermal will offset losses from the drop in Ocean Thermal's long position.| American Security vs. Altius Renewable Royalties | American Security vs. Alternus Energy Group | American Security vs. Triad Pro Innovators | American Security vs. Verde Clean Fuels |
| Ocean Thermal vs. Verde Clean Fuels | Ocean Thermal vs. Smart Powerr Corp | Ocean Thermal vs. Ormat Technologies | Ocean Thermal vs. Tokyo Electric Power |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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