Correlation Between Integrated Wind and Bouvet
Can any of the company-specific risk be diversified away by investing in both Integrated Wind and Bouvet 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 Integrated Wind and Bouvet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Integrated Wind Solutions and Bouvet, you can compare the effects of market volatilities on Integrated Wind and Bouvet 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 Integrated Wind with a short position of Bouvet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integrated Wind and Bouvet.
Diversification Opportunities for Integrated Wind and Bouvet
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Integrated and Bouvet is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Integrated Wind Solutions and Bouvet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bouvet and Integrated Wind 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 Integrated Wind Solutions are associated (or correlated) with Bouvet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bouvet has no effect on the direction of Integrated Wind i.e., Integrated Wind and Bouvet go up and down completely randomly.
Pair Corralation between Integrated Wind and Bouvet
Assuming the 90 days trading horizon Integrated Wind Solutions is expected to generate 2.21 times more return on investment than Bouvet. However, Integrated Wind is 2.21 times more volatile than Bouvet. It trades about 0.03 of its potential returns per unit of risk. Bouvet is currently generating about 0.03 per unit of risk. If you would invest 3,960 in Integrated Wind Solutions on September 1, 2024 and sell it today you would earn a total of 920.00 from holding Integrated Wind Solutions or generate 23.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Integrated Wind Solutions vs. Bouvet
Performance |
| Timeline |
| Integrated Wind Solutions |
| Bouvet |
Integrated Wind and Bouvet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Integrated Wind and Bouvet
The main advantage of trading using opposite Integrated Wind and Bouvet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Integrated Wind position performs unexpectedly, Bouvet 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 Bouvet will offset losses from the drop in Bouvet's long position.| Integrated Wind vs. Edda Wind ASA | Integrated Wind vs. Cloudberry Clean Energy | Integrated Wind vs. Cadeler As | Integrated Wind vs. Otovo 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |