Correlation Between Bloom Energy and Global Industrial
Can any of the company-specific risk be diversified away by investing in both Bloom Energy and Global Industrial 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 Global Industrial 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 Global Industrial Co, you can compare the effects of market volatilities on Bloom Energy and Global Industrial 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 Global Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Global Industrial.
Diversification Opportunities for Bloom Energy and Global Industrial
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bloom and Global is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy Corp and Global Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Industrial 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 Global Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Industrial has no effect on the direction of Bloom Energy i.e., Bloom Energy and Global Industrial go up and down completely randomly.
Pair Corralation between Bloom Energy and Global Industrial
Allowing for the 90-day total investment horizon Bloom Energy Corp is expected to generate 2.61 times more return on investment than Global Industrial. However, Bloom Energy is 2.61 times more volatile than Global Industrial Co. It trades about 0.38 of its potential returns per unit of risk. Global Industrial Co is currently generating about -0.09 per unit of risk. If you would invest 1,014 in Bloom Energy Corp on August 30, 2024 and sell it today you would earn a total of 1,707 from holding Bloom Energy Corp or generate 168.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloom Energy Corp vs. Global Industrial Co
Performance |
| Timeline |
| Bloom Energy Corp |
| Global Industrial |
Bloom Energy and Global Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloom Energy and Global Industrial
The main advantage of trading using opposite Bloom Energy and Global Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, Global Industrial 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 Industrial will offset losses from the drop in Global Industrial's long position.| Bloom Energy vs. Plug Power | Bloom Energy vs. Microvast Holdings | Bloom Energy vs. Solid Power | Bloom Energy vs. CBAK Energy Technology |
| Global Industrial vs. Distribution Solutions Group | Global Industrial vs. Core Main | Global Industrial vs. Applied Industrial Technologies | Global Industrial vs. BlueLinx 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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