Correlation Between Huaneng Power and Vistra Energy
Can any of the company-specific risk be diversified away by investing in both Huaneng Power and Vistra 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 Huaneng Power and Vistra Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huaneng Power International and Vistra Energy Corp, you can compare the effects of market volatilities on Huaneng Power and Vistra 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 Huaneng Power with a short position of Vistra Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huaneng Power and Vistra Energy.
Diversification Opportunities for Huaneng Power and Vistra Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Huaneng and Vistra is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Huaneng Power International and Vistra Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vistra Energy Corp and Huaneng Power 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 Huaneng Power International are associated (or correlated) with Vistra Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vistra Energy Corp has no effect on the direction of Huaneng Power i.e., Huaneng Power and Vistra Energy go up and down completely randomly.
Pair Corralation between Huaneng Power and Vistra Energy
Assuming the 90 days horizon Huaneng Power International is expected to generate 3.82 times more return on investment than Vistra Energy. However, Huaneng Power is 3.82 times more volatile than Vistra Energy Corp. It trades about 0.08 of its potential returns per unit of risk. Vistra Energy Corp is currently generating about 0.11 per unit of risk. If you would invest 44.00 in Huaneng Power International on August 24, 2024 and sell it today you would earn a total of 6.00 from holding Huaneng Power International or generate 13.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huaneng Power International vs. Vistra Energy Corp
Performance |
| Timeline |
| Huaneng Power Intern |
| Vistra Energy Corp |
Huaneng Power and Vistra Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huaneng Power and Vistra Energy
The main advantage of trading using opposite Huaneng Power and Vistra Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huaneng Power position performs unexpectedly, Vistra 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 Vistra Energy will offset losses from the drop in Vistra Energy's long position.| Huaneng Power vs. Powertap Hydrogen Capital | Huaneng Power vs. Clearway Energy | Huaneng Power vs. Fusion Fuel Green | Huaneng Power vs. Orsted AS ADR |
| Vistra Energy vs. Pampa Energia SA | Vistra Energy vs. TransAlta Corp | Vistra Energy vs. Kenon Holdings | Vistra Energy vs. NRG Energy |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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