Correlation Between Beam Global and Pioneer Power
Can any of the company-specific risk be diversified away by investing in both Beam Global and Pioneer Power 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 Beam Global and Pioneer Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beam Global and Pioneer Power Solutions, you can compare the effects of market volatilities on Beam Global and Pioneer Power 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 Beam Global with a short position of Pioneer Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beam Global and Pioneer Power.
Diversification Opportunities for Beam Global and Pioneer Power
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Beam and Pioneer is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Beam Global and Pioneer Power Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Power Solutions and Beam Global 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 Beam Global are associated (or correlated) with Pioneer Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Power Solutions has no effect on the direction of Beam Global i.e., Beam Global and Pioneer Power go up and down completely randomly.
Pair Corralation between Beam Global and Pioneer Power
Given the investment horizon of 90 days Beam Global is expected to under-perform the Pioneer Power. But the stock apears to be less risky and, when comparing its historical volatility, Beam Global is 1.19 times less risky than Pioneer Power. The stock trades about -0.09 of its potential returns per unit of risk. The Pioneer Power Solutions is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 425.00 in Pioneer Power Solutions on August 29, 2024 and sell it today you would earn a total of 165.00 from holding Pioneer Power Solutions or generate 38.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beam Global vs. Pioneer Power Solutions
Performance |
| Timeline |
| Beam Global |
| Pioneer Power Solutions |
Beam Global and Pioneer Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beam Global and Pioneer Power
The main advantage of trading using opposite Beam Global and Pioneer Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beam Global position performs unexpectedly, Pioneer Power 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 Pioneer Power will offset losses from the drop in Pioneer Power's long position.| Beam Global vs. Sunrun Inc | Beam Global vs. Emeren Group | Beam Global vs. Sunnova Energy International | Beam Global vs. Maxeon Solar Technologies |
| Pioneer Power vs. CBAK Energy Technology | Pioneer Power vs. Ocean Power Technologies | Pioneer Power vs. Ideal Power | Pioneer Power vs. Expion360 |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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