Correlation Between Azure Power and Ormat Technologies
Can any of the company-specific risk be diversified away by investing in both Azure Power and Ormat Technologies 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 Azure Power and Ormat Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Azure Power Global and Ormat Technologies, you can compare the effects of market volatilities on Azure Power and Ormat Technologies 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 Azure Power with a short position of Ormat Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Azure Power and Ormat Technologies.
Diversification Opportunities for Azure Power and Ormat Technologies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Azure and Ormat is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Azure Power Global and Ormat Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ormat Technologies and Azure Power 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 Azure Power Global are associated (or correlated) with Ormat Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ormat Technologies has no effect on the direction of Azure Power i.e., Azure Power and Ormat Technologies go up and down completely randomly.
Pair Corralation between Azure Power and Ormat Technologies
If you would invest 34.00 in Azure Power Global on November 2, 2024 and sell it today you would earn a total of 0.00 from holding Azure Power Global or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Azure Power Global vs. Ormat Technologies
Performance |
| Timeline |
| Azure Power Global |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ormat Technologies |
Azure Power and Ormat Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Azure Power and Ormat Technologies
The main advantage of trading using opposite Azure Power and Ormat Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Azure Power position performs unexpectedly, Ormat Technologies 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 Ormat Technologies will offset losses from the drop in Ormat Technologies' long position.| Azure Power vs. Altus Power | Azure Power vs. Ormat Technologies | Azure Power vs. Enlight Renewable Energy | Azure Power vs. Fluence Energy |
| Ormat Technologies vs. Altus Power | Ormat Technologies vs. Enlight Renewable Energy | Ormat Technologies vs. Fluence Energy | Ormat Technologies vs. Clearway Energy |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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