Correlation Between Alliant Energy and Enersys
Can any of the company-specific risk be diversified away by investing in both Alliant Energy and Enersys 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 Alliant Energy and Enersys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliant Energy Corp and Enersys, you can compare the effects of market volatilities on Alliant Energy and Enersys 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 Alliant Energy with a short position of Enersys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliant Energy and Enersys.
Diversification Opportunities for Alliant Energy and Enersys
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alliant and Enersys is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Alliant Energy Corp and Enersys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersys and Alliant Energy 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 Alliant Energy Corp are associated (or correlated) with Enersys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersys has no effect on the direction of Alliant Energy i.e., Alliant Energy and Enersys go up and down completely randomly.
Pair Corralation between Alliant Energy and Enersys
Considering the 90-day investment horizon Alliant Energy Corp is expected to generate 0.66 times more return on investment than Enersys. However, Alliant Energy Corp is 1.53 times less risky than Enersys. It trades about 0.17 of its potential returns per unit of risk. Enersys is currently generating about -0.04 per unit of risk. If you would invest 5,025 in Alliant Energy Corp on September 1, 2024 and sell it today you would earn a total of 1,295 from holding Alliant Energy Corp or generate 25.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alliant Energy Corp vs. Enersys
Performance |
| Timeline |
| Alliant Energy Corp |
| Enersys |
Alliant Energy and Enersys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliant Energy and Enersys
The main advantage of trading using opposite Alliant Energy and Enersys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliant Energy position performs unexpectedly, Enersys 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 Enersys will offset losses from the drop in Enersys' long position.| Alliant Energy vs. MGE Energy | Alliant Energy vs. CMS Energy | Alliant Energy vs. OGE Energy | Alliant Energy vs. DTE Energy |
| Enersys vs. Advanced Energy Industries | Enersys vs. Hubbell | Enersys vs. Acuity Brands | Enersys vs. Kimball Electronics |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |