Correlation Between Plug Power and WisdomTree

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Can any of the company-specific risk be diversified away by investing in both Plug Power and WisdomTree 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 Plug Power and WisdomTree into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plug Power and WisdomTree, you can compare the effects of market volatilities on Plug Power and WisdomTree 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 Plug Power with a short position of WisdomTree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plug Power and WisdomTree.

Diversification Opportunities for Plug Power and WisdomTree

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Plug and WisdomTree is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Plug Power and WisdomTree in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree and Plug Power 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 Plug Power are associated (or correlated) with WisdomTree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree has no effect on the direction of Plug Power i.e., Plug Power and WisdomTree go up and down completely randomly.

Pair Corralation between Plug Power and WisdomTree

If you would invest (100.00) in WisdomTree on October 31, 2025 and sell it today you would earn a total of  100.00  from holding WisdomTree or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Plug Power  vs.  WisdomTree

 Performance 
       Timeline  
Plug Power 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Plug Power has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Plug Power is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
WisdomTree 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days WisdomTree has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, WisdomTree is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Plug Power and WisdomTree Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Plug Power and WisdomTree

The main advantage of trading using opposite Plug Power and WisdomTree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plug Power position performs unexpectedly, WisdomTree 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 WisdomTree will offset losses from the drop in WisdomTree's long position.
The idea behind Plug Power and WisdomTree pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

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