Correlation Between FuelCell Energy and Prysmian SpA
Can any of the company-specific risk be diversified away by investing in both FuelCell Energy and Prysmian SpA 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 Prysmian SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FuelCell Energy and Prysmian SpA, you can compare the effects of market volatilities on FuelCell Energy and Prysmian SpA 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 Prysmian SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of FuelCell Energy and Prysmian SpA.
Diversification Opportunities for FuelCell Energy and Prysmian SpA
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between FuelCell and Prysmian is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding FuelCell Energy and Prysmian SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prysmian SpA 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 Prysmian SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prysmian SpA has no effect on the direction of FuelCell Energy i.e., FuelCell Energy and Prysmian SpA go up and down completely randomly.
Pair Corralation between FuelCell Energy and Prysmian SpA
Given the investment horizon of 90 days FuelCell Energy is expected to generate 4.35 times more return on investment than Prysmian SpA. However, FuelCell Energy is 4.35 times more volatile than Prysmian SpA. It trades about 0.04 of its potential returns per unit of risk. Prysmian SpA is currently generating about -0.2 per unit of risk. If you would invest 1,101 in FuelCell Energy on August 29, 2024 and sell it today you would lose (31.00) from holding FuelCell Energy or give up 2.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FuelCell Energy vs. Prysmian SpA
Performance |
| Timeline |
| FuelCell Energy |
| Prysmian SpA |
FuelCell Energy and Prysmian SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FuelCell Energy and Prysmian SpA
The main advantage of trading using opposite FuelCell Energy and Prysmian SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FuelCell Energy position performs unexpectedly, Prysmian SpA 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 Prysmian SpA will offset losses from the drop in Prysmian SpA's long position.| FuelCell Energy vs. Bloom Energy Corp | FuelCell Energy vs. Eos Energy Enterprises | FuelCell Energy vs. Sunrise New Energy | FuelCell Energy vs. GrafTech International |
| Prysmian SpA vs. FREYR Battery SA | Prysmian SpA vs. nVent Electric PLC | Prysmian SpA vs. Hubbell | Prysmian SpA vs. Advanced Energy Industries |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |