Correlation Between Carnegie Clean and Metrics Master

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Can any of the company-specific risk be diversified away by investing in both Carnegie Clean and Metrics Master 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 Carnegie Clean and Metrics Master into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carnegie Clean Energy and Metrics Master Income, you can compare the effects of market volatilities on Carnegie Clean and Metrics Master 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 Carnegie Clean with a short position of Metrics Master. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carnegie Clean and Metrics Master.

Diversification Opportunities for Carnegie Clean and Metrics Master

-0.2
  Correlation Coefficient

Good diversification

The 3 months correlation between Carnegie and Metrics is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Carnegie Clean Energy and Metrics Master Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metrics Master Income and Carnegie Clean 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 Carnegie Clean Energy are associated (or correlated) with Metrics Master. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metrics Master Income has no effect on the direction of Carnegie Clean i.e., Carnegie Clean and Metrics Master go up and down completely randomly.

Pair Corralation between Carnegie Clean and Metrics Master

Assuming the 90 days trading horizon Carnegie Clean Energy is expected to generate 36.13 times more return on investment than Metrics Master. However, Carnegie Clean is 36.13 times more volatile than Metrics Master Income. It trades about 0.1 of its potential returns per unit of risk. Metrics Master Income is currently generating about 0.07 per unit of risk. If you would invest  5.00  in Carnegie Clean Energy on October 26, 2024 and sell it today you would lose (1.10) from holding Carnegie Clean Energy or give up 22.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Carnegie Clean Energy  vs.  Metrics Master Income

 Performance 
       Timeline  
Carnegie Clean Energy 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Very Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Carnegie Clean Energy are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Carnegie Clean may actually be approaching a critical reversion point that can send shares even higher in February 2025.
Metrics Master Income 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Metrics Master Income are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Metrics Master is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Carnegie Clean and Metrics Master Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Carnegie Clean and Metrics Master

The main advantage of trading using opposite Carnegie Clean and Metrics Master positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carnegie Clean position performs unexpectedly, Metrics Master 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 Metrics Master will offset losses from the drop in Metrics Master's long position.
The idea behind Carnegie Clean Energy and Metrics Master Income pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

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