Correlation Between Energy Vault and Atlantica Sustainable
Can any of the company-specific risk be diversified away by investing in both Energy Vault and Atlantica Sustainable 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 Energy Vault and Atlantica Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy Vault Holdings and Atlantica Sustainable Infrastructure, you can compare the effects of market volatilities on Energy Vault and Atlantica Sustainable 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 Energy Vault with a short position of Atlantica Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Vault and Atlantica Sustainable.
Diversification Opportunities for Energy Vault and Atlantica Sustainable
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Energy and Atlantica is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Energy Vault Holdings and Atlantica Sustainable Infrastr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantica Sustainable and Energy Vault 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 Energy Vault Holdings are associated (or correlated) with Atlantica Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantica Sustainable has no effect on the direction of Energy Vault i.e., Energy Vault and Atlantica Sustainable go up and down completely randomly.
Pair Corralation between Energy Vault and Atlantica Sustainable
Given the investment horizon of 90 days Energy Vault Holdings is expected to generate 213.88 times more return on investment than Atlantica Sustainable. However, Energy Vault is 213.88 times more volatile than Atlantica Sustainable Infrastructure. It trades about 0.03 of its potential returns per unit of risk. Atlantica Sustainable Infrastructure is currently generating about 0.49 per unit of risk. If you would invest 204.00 in Energy Vault Holdings on November 1, 2024 and sell it today you would lose (19.00) from holding Energy Vault Holdings or give up 9.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 48.33% |
| Values | Daily Returns |
Energy Vault Holdings vs. Atlantica Sustainable Infrastr
Performance |
| Timeline |
| Energy Vault Holdings |
| Atlantica Sustainable |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Strong
Energy Vault and Atlantica Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Vault and Atlantica Sustainable
The main advantage of trading using opposite Energy Vault and Atlantica Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Vault position performs unexpectedly, Atlantica Sustainable 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 Atlantica Sustainable will offset losses from the drop in Atlantica Sustainable's long position.| Energy Vault vs. Renew Energy Global | Energy Vault vs. Fluence Energy | Energy Vault vs. Enlight Renewable Energy | Energy Vault vs. Advent Technologies Holdings |
| Atlantica Sustainable vs. Clearway Energy | Atlantica Sustainable vs. Brookfield Renewable Corp | Atlantica Sustainable vs. Nextera Energy Partners | Atlantica Sustainable vs. Brookfield Renewable 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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