Correlation Between Fusion Fuel and Advent Technologies
Can any of the company-specific risk be diversified away by investing in both Fusion Fuel and Advent 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 Fusion Fuel and Advent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fusion Fuel Green and Advent Technologies Holdings, you can compare the effects of market volatilities on Fusion Fuel and Advent 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 Fusion Fuel with a short position of Advent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fusion Fuel and Advent Technologies.
Diversification Opportunities for Fusion Fuel and Advent Technologies
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Fusion and Advent is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Fusion Fuel Green and Advent Technologies Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advent Technologies and Fusion Fuel 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 Fusion Fuel Green are associated (or correlated) with Advent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advent Technologies has no effect on the direction of Fusion Fuel i.e., Fusion Fuel and Advent Technologies go up and down completely randomly.
Pair Corralation between Fusion Fuel and Advent Technologies
Given the investment horizon of 90 days Fusion Fuel Green is expected to under-perform the Advent Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Fusion Fuel Green is 1.57 times less risky than Advent Technologies. The stock trades about -0.1 of its potential returns per unit of risk. The Advent Technologies Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 335.00 in Advent Technologies Holdings on September 2, 2024 and sell it today you would earn a total of 155.00 from holding Advent Technologies Holdings or generate 46.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fusion Fuel Green vs. Advent Technologies Holdings
Performance |
| Timeline |
| Fusion Fuel Green |
| Advent Technologies |
Fusion Fuel and Advent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fusion Fuel and Advent Technologies
The main advantage of trading using opposite Fusion Fuel and Advent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fusion Fuel position performs unexpectedly, Advent 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 Advent Technologies will offset losses from the drop in Advent Technologies' long position.| Fusion Fuel vs. Advent Technologies Holdings | Fusion Fuel vs. Fluence Energy | Fusion Fuel vs. Enlight Renewable Energy | Fusion Fuel vs. Renew Energy Global |
| Advent Technologies vs. Fusion Fuel Green | Advent Technologies vs. Fluence Energy | Advent Technologies vs. Altus Power | Advent Technologies vs. Energy Vault 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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