Correlation Between Clearway Energy and China Intel
Can any of the company-specific risk be diversified away by investing in both Clearway Energy and China Intel 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 Clearway Energy and China Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clearway Energy Class and China Intel Info, you can compare the effects of market volatilities on Clearway Energy and China Intel 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 Clearway Energy with a short position of China Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clearway Energy and China Intel.
Diversification Opportunities for Clearway Energy and China Intel
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Clearway and China is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Clearway Energy Class and China Intel Info in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Intel Info and Clearway 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 Clearway Energy Class are associated (or correlated) with China Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Intel Info has no effect on the direction of Clearway Energy i.e., Clearway Energy and China Intel go up and down completely randomly.
Pair Corralation between Clearway Energy and China Intel
Given the investment horizon of 90 days Clearway Energy is expected to generate 9.12 times less return on investment than China Intel. But when comparing it to its historical volatility, Clearway Energy Class is 4.71 times less risky than China Intel. It trades about 0.03 of its potential returns per unit of risk. China Intel Info is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.60 in China Intel Info on September 12, 2024 and sell it today you would earn a total of 0.03 from holding China Intel Info or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Clearway Energy Class vs. China Intel Info
Performance |
| Timeline |
| Clearway Energy Class |
| China Intel Info |
Clearway Energy and China Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clearway Energy and China Intel
The main advantage of trading using opposite Clearway Energy and China Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clearway Energy position performs unexpectedly, China Intel 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 China Intel will offset losses from the drop in China Intel's long position.| Clearway Energy vs. Brookfield Renewable Corp | Clearway Energy vs. Clearway Energy | Clearway Energy vs. Nextera Energy Partners | Clearway Energy vs. Atlantica Sustainable Infrastructure |
| China Intel vs. Fusion Fuel Green | China Intel vs. Advent Technologies Holdings | China Intel vs. Fluence Energy | China Intel vs. Altus Power |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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