Correlation Between Enlight Renewable and Alternus Energy
Can any of the company-specific risk be diversified away by investing in both Enlight Renewable and Alternus Energy 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 Enlight Renewable and Alternus Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enlight Renewable Energy and Alternus Energy Group, you can compare the effects of market volatilities on Enlight Renewable and Alternus Energy 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 Enlight Renewable with a short position of Alternus Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enlight Renewable and Alternus Energy.
Diversification Opportunities for Enlight Renewable and Alternus Energy
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Enlight and Alternus is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Enlight Renewable Energy and Alternus Energy Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alternus Energy Group and Enlight Renewable 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 Enlight Renewable Energy are associated (or correlated) with Alternus Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alternus Energy Group has no effect on the direction of Enlight Renewable i.e., Enlight Renewable and Alternus Energy go up and down completely randomly.
Pair Corralation between Enlight Renewable and Alternus Energy
Given the investment horizon of 90 days Enlight Renewable Energy is expected to generate 10.44 times more return on investment than Alternus Energy. However, Enlight Renewable is 10.44 times more volatile than Alternus Energy Group. It trades about 0.07 of its potential returns per unit of risk. Alternus Energy Group is currently generating about -0.14 per unit of risk. If you would invest 196.00 in Enlight Renewable Energy on September 12, 2024 and sell it today you would earn a total of 1,442 from holding Enlight Renewable Energy or generate 735.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.3% |
| Values | Daily Returns |
Enlight Renewable Energy vs. Alternus Energy Group
Performance |
| Timeline |
| Enlight Renewable Energy |
| Alternus Energy Group |
Enlight Renewable and Alternus Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enlight Renewable and Alternus Energy
The main advantage of trading using opposite Enlight Renewable and Alternus Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enlight Renewable position performs unexpectedly, Alternus Energy 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 Alternus Energy will offset losses from the drop in Alternus Energy's long position.| Enlight Renewable vs. Simon Property Group | Enlight Renewable vs. Hafnia Limited | Enlight Renewable vs. National Vision Holdings | Enlight Renewable vs. Yuexiu Transport Infrastructure |
| Alternus Energy vs. Enlight Renewable Energy | Alternus Energy vs. Renew Energy Global | Alternus Energy vs. Clearway Energy Class | Alternus Energy 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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