Correlation Between Capital Clean and Cleantech Power
Can any of the company-specific risk be diversified away by investing in both Capital Clean and Cleantech 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 Capital Clean and Cleantech Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Clean Energy and Cleantech Power Corp, you can compare the effects of market volatilities on Capital Clean and Cleantech 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 Capital Clean with a short position of Cleantech Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Clean and Cleantech Power.
Diversification Opportunities for Capital Clean and Cleantech Power
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Capital and Cleantech is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Capital Clean Energy and Cleantech Power Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cleantech Power Corp and Capital 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 Capital Clean Energy are associated (or correlated) with Cleantech Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cleantech Power Corp has no effect on the direction of Capital Clean i.e., Capital Clean and Cleantech Power go up and down completely randomly.
Pair Corralation between Capital Clean and Cleantech Power
Given the investment horizon of 90 days Capital Clean is expected to generate 85.67 times less return on investment than Cleantech Power. But when comparing it to its historical volatility, Capital Clean Energy is 48.07 times less risky than Cleantech Power. It trades about 0.06 of its potential returns per unit of risk. Cleantech Power Corp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Cleantech Power Corp on August 27, 2024 and sell it today you would lose (1.41) from holding Cleantech Power Corp or give up 70.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital Clean Energy vs. Cleantech Power Corp
Performance |
| Timeline |
| Capital Clean Energy |
| Cleantech Power Corp |
Capital Clean and Cleantech Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Clean and Cleantech Power
The main advantage of trading using opposite Capital Clean and Cleantech Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Clean position performs unexpectedly, Cleantech 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 Cleantech Power will offset losses from the drop in Cleantech Power's long position.| Capital Clean vs. Star Bulk Carriers | Capital Clean vs. TOP Ships | Capital Clean vs. Seanergy Maritime Holdings | Capital Clean vs. Performance Shipping |
| Cleantech Power vs. Legacy Education | Cleantech Power vs. NVIDIA | Cleantech Power vs. Apple Inc | Cleantech Power vs. Microsoft |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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