Correlation Between Purecycle Technologies and Aker Carbon
Can any of the company-specific risk be diversified away by investing in both Purecycle Technologies and Aker Carbon 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 Purecycle Technologies and Aker Carbon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Purecycle Technologies Holdings and Aker Carbon Capture, you can compare the effects of market volatilities on Purecycle Technologies and Aker Carbon 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 Purecycle Technologies with a short position of Aker Carbon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Purecycle Technologies and Aker Carbon.
Diversification Opportunities for Purecycle Technologies and Aker Carbon
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Purecycle and Aker is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Purecycle Technologies Holding and Aker Carbon Capture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aker Carbon Capture and Purecycle 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 Purecycle Technologies Holdings are associated (or correlated) with Aker Carbon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aker Carbon Capture has no effect on the direction of Purecycle Technologies i.e., Purecycle Technologies and Aker Carbon go up and down completely randomly.
Pair Corralation between Purecycle Technologies and Aker Carbon
Considering the 90-day investment horizon Purecycle Technologies Holdings is expected to generate 1.22 times more return on investment than Aker Carbon. However, Purecycle Technologies is 1.22 times more volatile than Aker Carbon Capture. It trades about -0.06 of its potential returns per unit of risk. Aker Carbon Capture is currently generating about -0.15 per unit of risk. If you would invest 1,392 in Purecycle Technologies Holdings on August 27, 2024 and sell it today you would lose (100.00) from holding Purecycle Technologies Holdings or give up 7.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Purecycle Technologies Holding vs. Aker Carbon Capture
Performance |
| Timeline |
| Purecycle Technologies |
| Aker Carbon Capture |
Purecycle Technologies and Aker Carbon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Purecycle Technologies and Aker Carbon
The main advantage of trading using opposite Purecycle Technologies and Aker Carbon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Purecycle Technologies position performs unexpectedly, Aker Carbon 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 Aker Carbon will offset losses from the drop in Aker Carbon's long position.| Purecycle Technologies vs. PureCycle Technologies | Purecycle Technologies vs. Aker Carbon Capture | Purecycle Technologies vs. Federal Signal | Purecycle Technologies vs. CECO Environmental Corp |
| Aker Carbon vs. TOMI Environmental Solutions | Aker Carbon vs. Zurn Elkay Water | Aker Carbon vs. Federal Signal | Aker Carbon vs. Energy Recovery |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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