Correlation Between Crane and Ameresco
Can any of the company-specific risk be diversified away by investing in both Crane and Ameresco 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 Crane and Ameresco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crane Company and Ameresco, you can compare the effects of market volatilities on Crane and Ameresco 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 Crane with a short position of Ameresco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crane and Ameresco.
Diversification Opportunities for Crane and Ameresco
Very good diversification
The 3 months correlation between Crane and Ameresco is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Crane Company and Ameresco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameresco and Crane 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 Crane Company are associated (or correlated) with Ameresco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameresco has no effect on the direction of Crane i.e., Crane and Ameresco go up and down completely randomly.
Pair Corralation between Crane and Ameresco
Allowing for the 90-day total investment horizon Crane Company is expected to generate 0.56 times more return on investment than Ameresco. However, Crane Company is 1.79 times less risky than Ameresco. It trades about 0.05 of its potential returns per unit of risk. Ameresco is currently generating about -0.01 per unit of risk. If you would invest 11,923 in Crane Company on August 27, 2024 and sell it today you would earn a total of 6,513 from holding Crane Company or generate 54.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crane Company vs. Ameresco
Performance |
| Timeline |
| Crane Company |
| Ameresco |
Crane and Ameresco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crane and Ameresco
The main advantage of trading using opposite Crane and Ameresco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crane position performs unexpectedly, Ameresco 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 Ameresco will offset losses from the drop in Ameresco's long position.| Crane vs. Standex International | Crane vs. Donaldson | Crane vs. CSW Industrials | Crane vs. Franklin Electric Co |
| Ameresco vs. TPI Composites | Ameresco vs. Hannon Armstrong Sustainable | Ameresco vs. Atkore International Group | Ameresco vs. Daqo New Energy |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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