Correlation Between Flux Power and Bloom Energy
Can any of the company-specific risk be diversified away by investing in both Flux Power 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 Flux Power and Bloom Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flux Power Holdings and Bloom Energy Corp, you can compare the effects of market volatilities on Flux Power 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 Flux Power with a short position of Bloom Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flux Power and Bloom Energy.
Diversification Opportunities for Flux Power and Bloom Energy
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Flux and Bloom is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Flux Power Holdings 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 Flux Power 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 Flux Power Holdings 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 Flux Power i.e., Flux Power and Bloom Energy go up and down completely randomly.
Pair Corralation between Flux Power and Bloom Energy
Given the investment horizon of 90 days Flux Power Holdings is expected to under-perform the Bloom Energy. But the stock apears to be less risky and, when comparing its historical volatility, Flux Power Holdings is 2.38 times less risky than Bloom Energy. The stock trades about -0.13 of its potential returns per unit of risk. The Bloom Energy Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,392 in Bloom Energy Corp on November 18, 2024 and sell it today you would earn a total of 149.00 from holding Bloom Energy Corp or generate 6.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flux Power Holdings vs. Bloom Energy Corp
Performance |
| Timeline |
| Flux Power Holdings |
| Bloom Energy Corp |
Flux Power and Bloom Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flux Power and Bloom Energy
The main advantage of trading using opposite Flux Power and Bloom Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flux Power 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.| Flux Power vs. Espey Mfg Electronics | Flux Power vs. NeoVolta Warrant | Flux Power vs. Kimball Electronics | Flux Power vs. Hayward Holdings |
| 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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