Correlation Between GE Vernova and Fluence Energy
Can any of the company-specific risk be diversified away by investing in both GE Vernova and Fluence 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 GE Vernova and Fluence Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GE Vernova LLC and Fluence Energy, you can compare the effects of market volatilities on GE Vernova and Fluence 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 GE Vernova with a short position of Fluence Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of GE Vernova and Fluence Energy.
Diversification Opportunities for GE Vernova and Fluence Energy
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GEV and Fluence is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding GE Vernova LLC and Fluence Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fluence Energy and GE Vernova 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 GE Vernova LLC are associated (or correlated) with Fluence Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fluence Energy has no effect on the direction of GE Vernova i.e., GE Vernova and Fluence Energy go up and down completely randomly.
Pair Corralation between GE Vernova and Fluence Energy
Considering the 90-day investment horizon GE Vernova LLC is expected to generate 0.65 times more return on investment than Fluence Energy. However, GE Vernova LLC is 1.54 times less risky than Fluence Energy. It trades about 0.19 of its potential returns per unit of risk. Fluence Energy is currently generating about 0.02 per unit of risk. If you would invest 13,125 in GE Vernova LLC on August 30, 2024 and sell it today you would earn a total of 20,408 from holding GE Vernova LLC or generate 155.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 43.4% |
| Values | Daily Returns |
GE Vernova LLC vs. Fluence Energy
Performance |
| Timeline |
| GE Vernova LLC |
| Fluence Energy |
GE Vernova and Fluence Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GE Vernova and Fluence Energy
The main advantage of trading using opposite GE Vernova and Fluence Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GE Vernova position performs unexpectedly, Fluence 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 Fluence Energy will offset losses from the drop in Fluence Energy's long position.| GE Vernova vs. Stepan Company | GE Vernova vs. Griffon | GE Vernova vs. Vera Bradley | GE Vernova vs. Eldorado Gold Corp |
| Fluence Energy vs. Altus Power | Fluence Energy vs. Ormat Technologies | Fluence Energy vs. Enlight Renewable Energy | Fluence Energy vs. Advent Technologies Holdings |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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