Correlation Between CVD Equipment and Next Hydrogen
Can any of the company-specific risk be diversified away by investing in both CVD Equipment and Next Hydrogen 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 CVD Equipment and Next Hydrogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVD Equipment and Next Hydrogen Solutions, you can compare the effects of market volatilities on CVD Equipment and Next Hydrogen 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 CVD Equipment with a short position of Next Hydrogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVD Equipment and Next Hydrogen.
Diversification Opportunities for CVD Equipment and Next Hydrogen
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between CVD and Next is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding CVD Equipment and Next Hydrogen Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Next Hydrogen Solutions and CVD Equipment 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 CVD Equipment are associated (or correlated) with Next Hydrogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Next Hydrogen Solutions has no effect on the direction of CVD Equipment i.e., CVD Equipment and Next Hydrogen go up and down completely randomly.
Pair Corralation between CVD Equipment and Next Hydrogen
Considering the 90-day investment horizon CVD Equipment is expected to generate 0.48 times more return on investment than Next Hydrogen. However, CVD Equipment is 2.09 times less risky than Next Hydrogen. It trades about 0.1 of its potential returns per unit of risk. Next Hydrogen Solutions is currently generating about -0.11 per unit of risk. If you would invest 295.00 in CVD Equipment on September 2, 2024 and sell it today you would earn a total of 24.00 from holding CVD Equipment or generate 8.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVD Equipment vs. Next Hydrogen Solutions
Performance |
| Timeline |
| CVD Equipment |
| Next Hydrogen Solutions |
CVD Equipment and Next Hydrogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVD Equipment and Next Hydrogen
The main advantage of trading using opposite CVD Equipment and Next Hydrogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVD Equipment position performs unexpectedly, Next Hydrogen 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 Next Hydrogen will offset losses from the drop in Next Hydrogen's long position.| CVD Equipment vs. NXP Semiconductors NV | CVD Equipment vs. GSI Technology | CVD Equipment vs. MaxLinear | CVD Equipment vs. Texas Instruments Incorporated |
| Next Hydrogen vs. Weir Group PLC | Next Hydrogen vs. Greenshift Corp | Next Hydrogen vs. Quality Industrial Corp | Next Hydrogen vs. ITM Power Plc |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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