Correlation Between Capital Clean and SOUTHERN
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By analyzing existing cross correlation between Capital Clean Energy and SOUTHERN CALIF EDISON, you can compare the effects of market volatilities on Capital Clean and SOUTHERN 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 SOUTHERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Clean and SOUTHERN.
Diversification Opportunities for Capital Clean and SOUTHERN
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Capital and SOUTHERN is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Capital Clean Energy and SOUTHERN CALIF EDISON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHERN CALIF EDISON 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 SOUTHERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHERN CALIF EDISON has no effect on the direction of Capital Clean i.e., Capital Clean and SOUTHERN go up and down completely randomly.
Pair Corralation between Capital Clean and SOUTHERN
Given the investment horizon of 90 days Capital Clean Energy is expected to generate 1.8 times more return on investment than SOUTHERN. However, Capital Clean is 1.8 times more volatile than SOUTHERN CALIF EDISON. It trades about 0.08 of its potential returns per unit of risk. SOUTHERN CALIF EDISON is currently generating about 0.03 per unit of risk. If you would invest 1,279 in Capital Clean Energy on September 5, 2024 and sell it today you would earn a total of 564.00 from holding Capital Clean Energy or generate 44.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 67.34% |
| Values | Daily Returns |
Capital Clean Energy vs. SOUTHERN CALIF EDISON
Performance |
| Timeline |
| Capital Clean Energy |
| SOUTHERN CALIF EDISON |
Capital Clean and SOUTHERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Clean and SOUTHERN
The main advantage of trading using opposite Capital Clean and SOUTHERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Clean position performs unexpectedly, SOUTHERN 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 SOUTHERN will offset losses from the drop in SOUTHERN's long position.| Capital Clean vs. Natural Alternatives International | Capital Clean vs. Where Food Comes | Capital Clean vs. SunOpta | Capital Clean vs. Asbury Automotive Group |
| SOUTHERN vs. Capital Clean Energy | SOUTHERN vs. Mind Medicine | SOUTHERN vs. Chimerix | SOUTHERN vs. Spyre Therapeutics |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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