Correlation Between Nextera Energy and China Intel
Can any of the company-specific risk be diversified away by investing in both Nextera Energy and China Intel 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 Nextera Energy and China Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextera Energy Partners and China Intel Info, you can compare the effects of market volatilities on Nextera Energy and China Intel 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 Nextera Energy with a short position of China Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextera Energy and China Intel.
Diversification Opportunities for Nextera Energy and China Intel
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Nextera and China is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Nextera Energy Partners and China Intel Info in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Intel Info and Nextera 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 Nextera Energy Partners are associated (or correlated) with China Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Intel Info has no effect on the direction of Nextera Energy i.e., Nextera Energy and China Intel go up and down completely randomly.
Pair Corralation between Nextera Energy and China Intel
Considering the 90-day investment horizon Nextera Energy Partners is expected to under-perform the China Intel. But the stock apears to be less risky and, when comparing its historical volatility, Nextera Energy Partners is 2.78 times less risky than China Intel. The stock trades about -0.26 of its potential returns per unit of risk. The China Intel Info is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 0.69 in China Intel Info on August 30, 2024 and sell it today you would lose (0.06) from holding China Intel Info or give up 8.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.73% |
| Values | Daily Returns |
Nextera Energy Partners vs. China Intel Info
Performance |
| Timeline |
| Nextera Energy Partners |
| China Intel Info |
Nextera Energy and China Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nextera Energy and China Intel
The main advantage of trading using opposite Nextera Energy and China Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextera Energy position performs unexpectedly, China Intel 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 China Intel will offset losses from the drop in China Intel's long position.| Nextera Energy vs. Brookfield Renewable Corp | Nextera Energy vs. Algonquin Power Utilities | Nextera Energy vs. Clearway Energy Class | Nextera Energy vs. Atlantica Sustainable Infrastructure |
| China Intel vs. Atlantica Sustainable Infrastructure | China Intel vs. Clearway Energy | China Intel vs. Brookfield Renewable Corp | China Intel vs. Nextera Energy Partners |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |