Correlation Between Bloom Energy and Toro
Can any of the company-specific risk be diversified away by investing in both Bloom Energy and Toro 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 Toro 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 Toro, you can compare the effects of market volatilities on Bloom Energy and Toro 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 Toro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Toro.
Diversification Opportunities for Bloom Energy and Toro
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bloom and Toro is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy Corp and Toro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Toro 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 Toro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Toro has no effect on the direction of Bloom Energy i.e., Bloom Energy and Toro go up and down completely randomly.
Pair Corralation between Bloom Energy and Toro
Allowing for the 90-day total investment horizon Bloom Energy Corp is expected to generate 2.38 times more return on investment than Toro. However, Bloom Energy is 2.38 times more volatile than Toro. It trades about 0.05 of its potential returns per unit of risk. Toro is currently generating about -0.16 per unit of risk. If you would invest 2,438 in Bloom Energy Corp on November 9, 2024 and sell it today you would earn a total of 40.00 from holding Bloom Energy Corp or generate 1.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloom Energy Corp vs. Toro
Performance |
| Timeline |
| Bloom Energy Corp |
| Toro |
Bloom Energy and Toro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloom Energy and Toro
The main advantage of trading using opposite Bloom Energy and Toro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, Toro 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 Toro will offset losses from the drop in Toro's long position.| Bloom Energy vs. Plug Power | Bloom Energy vs. Microvast Holdings | Bloom Energy vs. Solid Power | Bloom Energy vs. CBAK Energy Technology |
| Toro vs. Seanergy Maritime Holdings | Toro vs. Globus Maritime | Toro vs. TOP Ships | Toro vs. Diana Shipping |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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