Correlation Between Green Hydrogen and FOM Technologies
Can any of the company-specific risk be diversified away by investing in both Green Hydrogen and FOM Technologies 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 Green Hydrogen and FOM Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Hydrogen Systems and FOM Technologies AS, you can compare the effects of market volatilities on Green Hydrogen and FOM Technologies 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 Green Hydrogen with a short position of FOM Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Hydrogen and FOM Technologies.
Diversification Opportunities for Green Hydrogen and FOM Technologies
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Green and FOM is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Green Hydrogen Systems and FOM Technologies AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FOM Technologies and Green Hydrogen 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 Green Hydrogen Systems are associated (or correlated) with FOM Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FOM Technologies has no effect on the direction of Green Hydrogen i.e., Green Hydrogen and FOM Technologies go up and down completely randomly.
Pair Corralation between Green Hydrogen and FOM Technologies
Assuming the 90 days trading horizon Green Hydrogen Systems is expected to generate 1.44 times more return on investment than FOM Technologies. However, Green Hydrogen is 1.44 times more volatile than FOM Technologies AS. It trades about -0.04 of its potential returns per unit of risk. FOM Technologies AS is currently generating about -0.09 per unit of risk. If you would invest 673.00 in Green Hydrogen Systems on August 25, 2024 and sell it today you would lose (458.00) from holding Green Hydrogen Systems or give up 68.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Green Hydrogen Systems vs. FOM Technologies AS
Performance |
| Timeline |
| Green Hydrogen Systems |
| FOM Technologies |
Green Hydrogen and FOM Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Hydrogen and FOM Technologies
The main advantage of trading using opposite Green Hydrogen and FOM Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Hydrogen position performs unexpectedly, FOM Technologies 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 FOM Technologies will offset losses from the drop in FOM Technologies' long position.| Green Hydrogen vs. Ambu AS | Green Hydrogen vs. GN Store Nord | Green Hydrogen vs. Bavarian Nordic | Green Hydrogen vs. FLSmidth Co |
| FOM Technologies vs. cBrain AS | FOM Technologies vs. Penneo AS | FOM Technologies vs. Shape Robotics AS | FOM Technologies vs. ALK Abell AS |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |