Correlation Between HITACHI STRMACHADR2 and Plug Power
Can any of the company-specific risk be diversified away by investing in both HITACHI STRMACHADR2 and Plug 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 HITACHI STRMACHADR2 and Plug Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HITACHI STRMACHADR2 and Plug Power, you can compare the effects of market volatilities on HITACHI STRMACHADR2 and Plug 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 HITACHI STRMACHADR2 with a short position of Plug Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of HITACHI STRMACHADR2 and Plug Power.
Diversification Opportunities for HITACHI STRMACHADR2 and Plug Power
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HITACHI and Plug is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding HITACHI STRMACHADR2 and Plug Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plug Power and HITACHI STRMACHADR2 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 HITACHI STRMACHADR2 are associated (or correlated) with Plug Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plug Power has no effect on the direction of HITACHI STRMACHADR2 i.e., HITACHI STRMACHADR2 and Plug Power go up and down completely randomly.
Pair Corralation between HITACHI STRMACHADR2 and Plug Power
Assuming the 90 days trading horizon HITACHI STRMACHADR2 is expected to generate 0.37 times more return on investment than Plug Power. However, HITACHI STRMACHADR2 is 2.7 times less risky than Plug Power. It trades about 0.0 of its potential returns per unit of risk. Plug Power is currently generating about -0.02 per unit of risk. If you would invest 4,430 in HITACHI STRMACHADR2 on August 29, 2024 and sell it today you would lose (330.00) from holding HITACHI STRMACHADR2 or give up 7.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HITACHI STRMACHADR2 vs. Plug Power
Performance |
| Timeline |
| HITACHI STRMACHADR2 |
| Plug Power |
HITACHI STRMACHADR2 and Plug Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HITACHI STRMACHADR2 and Plug Power
The main advantage of trading using opposite HITACHI STRMACHADR2 and Plug Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HITACHI STRMACHADR2 position performs unexpectedly, Plug 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 Plug Power will offset losses from the drop in Plug Power's long position.| HITACHI STRMACHADR2 vs. Superior Plus Corp | HITACHI STRMACHADR2 vs. NMI Holdings | HITACHI STRMACHADR2 vs. Origin Agritech | HITACHI STRMACHADR2 vs. SIVERS SEMICONDUCTORS AB |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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