Correlation Between Excelerate Energy and TransAlta Renewables
Can any of the company-specific risk be diversified away by investing in both Excelerate Energy and TransAlta Renewables 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 Excelerate Energy and TransAlta Renewables into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excelerate Energy and TransAlta Renewables, you can compare the effects of market volatilities on Excelerate Energy and TransAlta Renewables 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 Excelerate Energy with a short position of TransAlta Renewables. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excelerate Energy and TransAlta Renewables.
Diversification Opportunities for Excelerate Energy and TransAlta Renewables
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Excelerate and TransAlta is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Excelerate Energy and TransAlta Renewables in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TransAlta Renewables and Excelerate 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 Excelerate Energy are associated (or correlated) with TransAlta Renewables. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TransAlta Renewables has no effect on the direction of Excelerate Energy i.e., Excelerate Energy and TransAlta Renewables go up and down completely randomly.
Pair Corralation between Excelerate Energy and TransAlta Renewables
If you would invest 2,323 in Excelerate Energy on August 28, 2024 and sell it today you would earn a total of 685.00 from holding Excelerate Energy or generate 29.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Excelerate Energy vs. TransAlta Renewables
Performance |
| Timeline |
| Excelerate Energy |
| TransAlta Renewables |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Excelerate Energy and TransAlta Renewables Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excelerate Energy and TransAlta Renewables
The main advantage of trading using opposite Excelerate Energy and TransAlta Renewables positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excelerate Energy position performs unexpectedly, TransAlta Renewables 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 TransAlta Renewables will offset losses from the drop in TransAlta Renewables' long position.| Excelerate Energy vs. Atlantica Sustainable Infrastructure | Excelerate Energy vs. Clearway Energy | Excelerate Energy vs. Brookfield Renewable Corp | Excelerate Energy vs. Nextera Energy Partners |
| TransAlta Renewables vs. Green Impact Partners | TransAlta Renewables vs. Algonquin Power Utilities | TransAlta Renewables vs. Renew Energy Global | TransAlta Renewables vs. Excelerate 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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