Correlation Between Energy Services and Cadeler AS
Can any of the company-specific risk be diversified away by investing in both Energy Services and Cadeler AS 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 Energy Services and Cadeler AS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Services and Cadeler AS, you can compare the effects of market volatilities on Energy Services and Cadeler AS 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 Energy Services with a short position of Cadeler AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Services and Cadeler AS.
Diversification Opportunities for Energy Services and Cadeler AS
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Energy and Cadeler is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Energy Services and Cadeler AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cadeler AS and Energy Services 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 Energy Services are associated (or correlated) with Cadeler AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cadeler AS has no effect on the direction of Energy Services i.e., Energy Services and Cadeler AS go up and down completely randomly.
Pair Corralation between Energy Services and Cadeler AS
Given the investment horizon of 90 days Energy Services is expected to generate 2.19 times more return on investment than Cadeler AS. However, Energy Services is 2.19 times more volatile than Cadeler AS. It trades about 0.1 of its potential returns per unit of risk. Cadeler AS is currently generating about 0.09 per unit of risk. If you would invest 784.00 in Energy Services on August 27, 2024 and sell it today you would earn a total of 746.00 from holding Energy Services or generate 95.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy Services vs. Cadeler AS
Performance |
| Timeline |
| Energy Services |
| Cadeler AS |
Energy Services and Cadeler AS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Services and Cadeler AS
The main advantage of trading using opposite Energy Services and Cadeler AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Services position performs unexpectedly, Cadeler AS 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 Cadeler AS will offset losses from the drop in Cadeler AS's long position.| Energy Services vs. Bouygues SA | Energy Services vs. NV5 Global | Energy Services vs. Matrix Service Co | Energy Services vs. MYR Group |
| Cadeler AS vs. Sweetgreen | Cadeler AS vs. Shake Shack | Cadeler AS vs. GEN Restaurant Group, | Cadeler AS vs. Spyre Therapeutics |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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