Correlation Between FuelCell Energy and Bloom Energy
Can any of the company-specific risk be diversified away by investing in both FuelCell Energy and Bloom 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 FuelCell Energy and Bloom Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FuelCell Energy and Bloom Energy Corp, you can compare the effects of market volatilities on FuelCell Energy and Bloom 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 FuelCell Energy with a short position of Bloom Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of FuelCell Energy and Bloom Energy.
Diversification Opportunities for FuelCell Energy and Bloom Energy
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FuelCell and Bloom is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding FuelCell Energy and Bloom Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloom Energy Corp and FuelCell 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 FuelCell Energy are associated (or correlated) with Bloom Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloom Energy Corp has no effect on the direction of FuelCell Energy i.e., FuelCell Energy and Bloom Energy go up and down completely randomly.
Pair Corralation between FuelCell Energy and Bloom Energy
Given the investment horizon of 90 days FuelCell Energy is expected to under-perform the Bloom Energy. In addition to that, FuelCell Energy is 1.13 times more volatile than Bloom Energy Corp. It trades about -0.07 of its total potential returns per unit of risk. Bloom Energy Corp is currently generating about 0.03 per unit of volatility. If you would invest 2,198 in Bloom Energy Corp on August 23, 2024 and sell it today you would earn a total of 196.00 from holding Bloom Energy Corp or generate 8.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FuelCell Energy vs. Bloom Energy Corp
Performance |
| Timeline |
| FuelCell Energy |
| Bloom Energy Corp |
FuelCell Energy and Bloom Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FuelCell Energy and Bloom Energy
The main advantage of trading using opposite FuelCell Energy and Bloom Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FuelCell Energy position performs unexpectedly, Bloom 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 Bloom Energy will offset losses from the drop in Bloom Energy's long position.| FuelCell Energy vs. Bloom Energy Corp | FuelCell Energy vs. Microvast Holdings | FuelCell Energy vs. Solid Power | FuelCell Energy vs. Enovix Corp |
| Bloom Energy vs. Plug Power | Bloom Energy vs. Microvast Holdings | Bloom Energy vs. Solid Power | Bloom Energy vs. CBAK Energy Technology |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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