Correlation Between Cleen Energy and CNH Industrial
Can any of the company-specific risk be diversified away by investing in both Cleen Energy and CNH Industrial 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 Cleen Energy and CNH Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cleen Energy AG and CNH Industrial NV, you can compare the effects of market volatilities on Cleen Energy and CNH Industrial 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 Cleen Energy with a short position of CNH Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cleen Energy and CNH Industrial.
Diversification Opportunities for Cleen Energy and CNH Industrial
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cleen and CNH is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Cleen Energy AG and CNH Industrial NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNH Industrial NV and Cleen 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 Cleen Energy AG are associated (or correlated) with CNH Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNH Industrial NV has no effect on the direction of Cleen Energy i.e., Cleen Energy and CNH Industrial go up and down completely randomly.
Pair Corralation between Cleen Energy and CNH Industrial
Assuming the 90 days trading horizon Cleen Energy AG is expected to generate 1.7 times more return on investment than CNH Industrial. However, Cleen Energy is 1.7 times more volatile than CNH Industrial NV. It trades about 0.14 of its potential returns per unit of risk. CNH Industrial NV is currently generating about 0.09 per unit of risk. If you would invest 45.00 in Cleen Energy AG on August 23, 2024 and sell it today you would earn a total of 6.00 from holding Cleen Energy AG or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cleen Energy AG vs. CNH Industrial NV
Performance |
| Timeline |
| Cleen Energy AG |
| CNH Industrial NV |
Cleen Energy and CNH Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cleen Energy and CNH Industrial
The main advantage of trading using opposite Cleen Energy and CNH Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cleen Energy position performs unexpectedly, CNH Industrial 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 CNH Industrial will offset losses from the drop in CNH Industrial's long position.| Cleen Energy vs. Vienna Insurance Group | Cleen Energy vs. Erste Group Bank | Cleen Energy vs. AMAG Austria Metall | Cleen Energy vs. SBM Offshore NV |
| CNH Industrial vs. Erste Group Bank | CNH Industrial vs. SBM Offshore NV | CNH Industrial vs. Vienna Insurance Group | CNH Industrial vs. UNIQA Insurance Group |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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