Correlation Between Ormat Technologies and GE Vernova
Can any of the company-specific risk be diversified away by investing in both Ormat Technologies and GE Vernova 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 Ormat Technologies and GE Vernova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ormat Technologies and GE Vernova LLC, you can compare the effects of market volatilities on Ormat Technologies and GE Vernova 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 Ormat Technologies with a short position of GE Vernova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ormat Technologies and GE Vernova.
Diversification Opportunities for Ormat Technologies and GE Vernova
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ormat and GEV is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ormat Technologies and GE Vernova LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE Vernova LLC and Ormat Technologies 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 Ormat Technologies are associated (or correlated) with GE Vernova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE Vernova LLC has no effect on the direction of Ormat Technologies i.e., Ormat Technologies and GE Vernova go up and down completely randomly.
Pair Corralation between Ormat Technologies and GE Vernova
Considering the 90-day investment horizon Ormat Technologies is expected to under-perform the GE Vernova. But the stock apears to be less risky and, when comparing its historical volatility, Ormat Technologies is 1.94 times less risky than GE Vernova. The stock trades about -0.03 of its potential returns per unit of risk. The GE Vernova LLC is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 13,115 in GE Vernova LLC on November 1, 2024 and sell it today you would earn a total of 25,167 from holding GE Vernova LLC or generate 191.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 44.73% |
| Values | Daily Returns |
Ormat Technologies vs. GE Vernova LLC
Performance |
| Timeline |
| Ormat Technologies |
| GE Vernova LLC |
Ormat Technologies and GE Vernova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ormat Technologies and GE Vernova
The main advantage of trading using opposite Ormat Technologies and GE Vernova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ormat Technologies position performs unexpectedly, GE Vernova 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 GE Vernova will offset losses from the drop in GE Vernova's long position.| Ormat Technologies vs. Altus Power | Ormat Technologies vs. Enlight Renewable Energy | Ormat Technologies vs. Fluence Energy | Ormat Technologies vs. Clearway Energy |
| GE Vernova vs. Taiwan Semiconductor Manufacturing | GE Vernova vs. RBC Bearings Incorporated | GE Vernova vs. Everspin Technologies | GE Vernova vs. Elmos Semiconductor SE |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |