Correlation Between Fluence Energy and Black Hills
Can any of the company-specific risk be diversified away by investing in both Fluence Energy and Black Hills 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 Fluence Energy and Black Hills into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fluence Energy and Black Hills, you can compare the effects of market volatilities on Fluence Energy and Black Hills 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 Fluence Energy with a short position of Black Hills. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fluence Energy and Black Hills.
Diversification Opportunities for Fluence Energy and Black Hills
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fluence and Black is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Fluence Energy and Black Hills in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Black Hills and Fluence 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 Fluence Energy are associated (or correlated) with Black Hills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Black Hills has no effect on the direction of Fluence Energy i.e., Fluence Energy and Black Hills go up and down completely randomly.
Pair Corralation between Fluence Energy and Black Hills
Given the investment horizon of 90 days Fluence Energy is expected to generate 3.46 times more return on investment than Black Hills. However, Fluence Energy is 3.46 times more volatile than Black Hills. It trades about 0.06 of its potential returns per unit of risk. Black Hills is currently generating about 0.13 per unit of risk. If you would invest 2,162 in Fluence Energy on August 26, 2024 and sell it today you would earn a total of 140.00 from holding Fluence Energy or generate 6.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fluence Energy vs. Black Hills
Performance |
| Timeline |
| Fluence Energy |
| Black Hills |
Fluence Energy and Black Hills Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fluence Energy and Black Hills
The main advantage of trading using opposite Fluence Energy and Black Hills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fluence Energy position performs unexpectedly, Black Hills 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 Black Hills will offset losses from the drop in Black Hills' long position.| Fluence Energy vs. Altus Power | Fluence Energy vs. Ormat Technologies | Fluence Energy vs. Enlight Renewable Energy | Fluence Energy vs. Advent Technologies Holdings |
| Black Hills vs. NorthWestern | Black Hills vs. Avista | Black Hills vs. Otter Tail | Black Hills vs. Companhia Paranaense de |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |