Correlation Between Atlantica Sustainable and Lundin Energy
Can any of the company-specific risk be diversified away by investing in both Atlantica Sustainable and Lundin Energy 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 Atlantica Sustainable and Lundin Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlantica Sustainable Infrastructure and Lundin Energy AB, you can compare the effects of market volatilities on Atlantica Sustainable and Lundin Energy 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 Atlantica Sustainable with a short position of Lundin Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantica Sustainable and Lundin Energy.
Diversification Opportunities for Atlantica Sustainable and Lundin Energy
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Atlantica and Lundin is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Atlantica Sustainable Infrastr and Lundin Energy AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lundin Energy AB and Atlantica Sustainable 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 Atlantica Sustainable Infrastructure are associated (or correlated) with Lundin Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lundin Energy AB has no effect on the direction of Atlantica Sustainable i.e., Atlantica Sustainable and Lundin Energy go up and down completely randomly.
Pair Corralation between Atlantica Sustainable and Lundin Energy
Allowing for the 90-day total investment horizon Atlantica Sustainable Infrastructure is expected to generate 0.06 times more return on investment than Lundin Energy. However, Atlantica Sustainable Infrastructure is 15.81 times less risky than Lundin Energy. It trades about -0.11 of its potential returns per unit of risk. Lundin Energy AB is currently generating about -0.26 per unit of risk. If you would invest 2,206 in Atlantica Sustainable Infrastructure on September 1, 2024 and sell it today you would lose (12.00) from holding Atlantica Sustainable Infrastructure or give up 0.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlantica Sustainable Infrastr vs. Lundin Energy AB
Performance |
| Timeline |
| Atlantica Sustainable |
| Lundin Energy AB |
Atlantica Sustainable and Lundin Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlantica Sustainable and Lundin Energy
The main advantage of trading using opposite Atlantica Sustainable and Lundin Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlantica Sustainable position performs unexpectedly, Lundin Energy 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 Lundin Energy will offset losses from the drop in Lundin Energy's long position.| Atlantica Sustainable vs. Clearway Energy | Atlantica Sustainable vs. Brookfield Renewable Corp | Atlantica Sustainable vs. Nextera Energy Partners | Atlantica Sustainable vs. Brookfield Renewable Partners |
| Lundin Energy vs. Renew Energy Global | Lundin Energy vs. Energy Vault Holdings | Lundin Energy vs. Fluence Energy | Lundin Energy vs. Advent Technologies Holdings |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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