Correlation Between Greenshift Corp and ITM Power
Can any of the company-specific risk be diversified away by investing in both Greenshift Corp and ITM Power 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 Greenshift Corp and ITM Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenshift Corp and ITM Power Plc, you can compare the effects of market volatilities on Greenshift Corp and ITM Power 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 Greenshift Corp with a short position of ITM Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenshift Corp and ITM Power.
Diversification Opportunities for Greenshift Corp and ITM Power
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Greenshift and ITM is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Greenshift Corp and ITM Power Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITM Power Plc and Greenshift Corp 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 Greenshift Corp are associated (or correlated) with ITM Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITM Power Plc has no effect on the direction of Greenshift Corp i.e., Greenshift Corp and ITM Power go up and down completely randomly.
Pair Corralation between Greenshift Corp and ITM Power
Given the investment horizon of 90 days Greenshift Corp is expected to generate 3.57 times more return on investment than ITM Power. However, Greenshift Corp is 3.57 times more volatile than ITM Power Plc. It trades about 0.0 of its potential returns per unit of risk. ITM Power Plc is currently generating about -0.24 per unit of risk. If you would invest 3.43 in Greenshift Corp on September 1, 2024 and sell it today you would lose (0.63) from holding Greenshift Corp or give up 18.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Greenshift Corp vs. ITM Power Plc
Performance |
| Timeline |
| Greenshift Corp |
| ITM Power Plc |
Greenshift Corp and ITM Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenshift Corp and ITM Power
The main advantage of trading using opposite Greenshift Corp and ITM Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenshift Corp position performs unexpectedly, ITM Power 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 ITM Power will offset losses from the drop in ITM Power's long position.| Greenshift Corp vs. Titan Logix Corp | Greenshift Corp vs. Next Hydrogen Solutions | Greenshift Corp vs. Quality Industrial Corp | Greenshift Corp vs. Weir Group PLC |
| ITM Power vs. Next Hydrogen Solutions | ITM Power vs. Nel ASA | ITM Power vs. Titan Logix Corp | ITM Power vs. Weir Group PLC |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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