Correlation Between Cleantech Power and Adient PLC
Can any of the company-specific risk be diversified away by investing in both Cleantech Power and Adient PLC 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 Cleantech Power and Adient PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cleantech Power Corp and Adient PLC, you can compare the effects of market volatilities on Cleantech Power and Adient PLC 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 Cleantech Power with a short position of Adient PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cleantech Power and Adient PLC.
Diversification Opportunities for Cleantech Power and Adient PLC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cleantech and Adient is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cleantech Power Corp and Adient PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adient PLC and Cleantech 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 Cleantech Power Corp are associated (or correlated) with Adient PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adient PLC has no effect on the direction of Cleantech Power i.e., Cleantech Power and Adient PLC go up and down completely randomly.
Pair Corralation between Cleantech Power and Adient PLC
Assuming the 90 days horizon Cleantech Power Corp is expected to generate 31.61 times more return on investment than Adient PLC. However, Cleantech Power is 31.61 times more volatile than Adient PLC. It trades about 0.09 of its potential returns per unit of risk. Adient PLC is currently generating about -0.08 per unit of risk. If you would invest 2.45 in Cleantech Power Corp on January 15, 2025 and sell it today you would lose (1.86) from holding Cleantech Power Corp or give up 75.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.39% |
| Values | Daily Returns |
Cleantech Power Corp vs. Adient PLC
Performance |
| Timeline |
| Cleantech Power Corp |
| Adient PLC |
Cleantech Power and Adient PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cleantech Power and Adient PLC
The main advantage of trading using opposite Cleantech Power and Adient PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cleantech Power position performs unexpectedly, Adient PLC 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 Adient PLC will offset losses from the drop in Adient PLC's long position.| Cleantech Power vs. Boston Beer | Cleantech Power vs. Vita Coco | Cleantech Power vs. Triumph Apparel | Cleantech Power vs. G III Apparel Group |
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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.
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