Correlation Between Bloom Energy and 374Water Common
Can any of the company-specific risk be diversified away by investing in both Bloom Energy and 374Water Common 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 374Water Common 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 374Water Common Stock, you can compare the effects of market volatilities on Bloom Energy and 374Water Common 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 374Water Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and 374Water Common.
Diversification Opportunities for Bloom Energy and 374Water Common
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bloom and 374Water is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy Corp and 374Water Common Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 374Water Common Stock 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 374Water Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 374Water Common Stock has no effect on the direction of Bloom Energy i.e., Bloom Energy and 374Water Common go up and down completely randomly.
Pair Corralation between Bloom Energy and 374Water Common
Allowing for the 90-day total investment horizon Bloom Energy Corp is expected to generate 1.3 times more return on investment than 374Water Common. However, Bloom Energy is 1.3 times more volatile than 374Water Common Stock. It trades about 0.09 of its potential returns per unit of risk. 374Water Common Stock is currently generating about -0.42 per unit of risk. If you would invest 2,288 in Bloom Energy Corp on October 20, 2024 and sell it today you would earn a total of 104.00 from holding Bloom Energy Corp or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloom Energy Corp vs. 374Water Common Stock
Performance |
| Timeline |
| Bloom Energy Corp |
| 374Water Common Stock |
Bloom Energy and 374Water Common Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloom Energy and 374Water Common
The main advantage of trading using opposite Bloom Energy and 374Water Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, 374Water Common 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 374Water Common will offset losses from the drop in 374Water Common's long position.| Bloom Energy vs. Plug Power | Bloom Energy vs. Microvast Holdings | Bloom Energy vs. Solid Power | Bloom Energy vs. CBAK Energy Technology |
| 374Water Common vs. Zurn Elkay Water | 374Water Common vs. Energy Recovery | 374Water Common vs. CECO Environmental Corp | 374Water Common vs. Federal Signal |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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