Correlation Between Bloom Energy and Now
Can any of the company-specific risk be diversified away by investing in both Bloom Energy and Now 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 Bloom Energy and Now into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloom Energy Corp and Now Inc, you can compare the effects of market volatilities on Bloom Energy and Now 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 Bloom Energy with a short position of Now. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Now.
Diversification Opportunities for Bloom Energy and Now
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bloom and Now is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy Corp and Now Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Now Inc and Bloom Energy 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 Bloom Energy Corp are associated (or correlated) with Now. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Now Inc has no effect on the direction of Bloom Energy i.e., Bloom Energy and Now go up and down completely randomly.
Pair Corralation between Bloom Energy and Now
Allowing for the 90-day total investment horizon Bloom Energy Corp is expected to generate 2.02 times more return on investment than Now. However, Bloom Energy is 2.02 times more volatile than Now Inc. It trades about 0.03 of its potential returns per unit of risk. Now Inc is currently generating about 0.03 per unit of risk. If you would invest 2,013 in Bloom Energy Corp on August 27, 2024 and sell it today you would earn a total of 563.00 from holding Bloom Energy Corp or generate 27.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloom Energy Corp vs. Now Inc
Performance |
| Timeline |
| Bloom Energy Corp |
| Now Inc |
Bloom Energy and Now Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloom Energy and Now
The main advantage of trading using opposite Bloom Energy and Now positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, Now 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 Now will offset losses from the drop in Now's long position.| Bloom Energy vs. Plug Power | Bloom Energy vs. Microvast Holdings | Bloom Energy vs. Solid Power | Bloom Energy vs. CBAK Energy Technology |
| Now vs. Global Industrial Co | Now vs. BlueLinx Holdings | Now vs. WESCO International | Now vs. MSC Industrial Direct |
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 Stocks Directory module to find actively traded stocks across global markets.
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