Correlation Between Salient Alternative and Firsthand Alternative
Can any of the company-specific risk be diversified away by investing in both Salient Alternative and Firsthand Alternative 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 Salient Alternative and Firsthand Alternative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salient Alternative Beta and Firsthand Alternative Energy, you can compare the effects of market volatilities on Salient Alternative and Firsthand Alternative 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 Salient Alternative with a short position of Firsthand Alternative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salient Alternative and Firsthand Alternative.
Diversification Opportunities for Salient Alternative and Firsthand Alternative
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Salient and Firsthand is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Salient Alternative Beta and Firsthand Alternative Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firsthand Alternative and Salient Alternative 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 Salient Alternative Beta are associated (or correlated) with Firsthand Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firsthand Alternative has no effect on the direction of Salient Alternative i.e., Salient Alternative and Firsthand Alternative go up and down completely randomly.
Pair Corralation between Salient Alternative and Firsthand Alternative
Assuming the 90 days horizon Salient Alternative is expected to generate 163.83 times less return on investment than Firsthand Alternative. But when comparing it to its historical volatility, Salient Alternative Beta is 2.33 times less risky than Firsthand Alternative. It trades about 0.0 of its potential returns per unit of risk. Firsthand Alternative Energy is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 985.00 in Firsthand Alternative Energy on September 13, 2024 and sell it today you would earn a total of 40.00 from holding Firsthand Alternative Energy or generate 4.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salient Alternative Beta vs. Firsthand Alternative Energy
Performance |
| Timeline |
| Salient Alternative Beta |
| Firsthand Alternative |
Salient Alternative and Firsthand Alternative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salient Alternative and Firsthand Alternative
The main advantage of trading using opposite Salient Alternative and Firsthand Alternative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salient Alternative position performs unexpectedly, Firsthand Alternative 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 Firsthand Alternative will offset losses from the drop in Firsthand Alternative's long position.| Salient Alternative vs. T Rowe Price | Salient Alternative vs. Morningstar Defensive Bond | Salient Alternative vs. Pace High Yield | Salient Alternative vs. Versatile Bond Portfolio |
| Firsthand Alternative vs. Guinness Atkinson Alternative | Firsthand Alternative vs. Calvert Global Energy | Firsthand Alternative vs. New Alternatives Fund | Firsthand Alternative vs. Shelton Green Alpha |
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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