Correlation Between Boston Beer and Ascent Solar
Can any of the company-specific risk be diversified away by investing in both Boston Beer and Ascent Solar 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 Boston Beer and Ascent Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Beer and Ascent Solar Technologies,, you can compare the effects of market volatilities on Boston Beer and Ascent Solar 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 Boston Beer with a short position of Ascent Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Beer and Ascent Solar.
Diversification Opportunities for Boston Beer and Ascent Solar
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Boston and Ascent is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Boston Beer and Ascent Solar Technologies, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascent Solar Technol and Boston Beer 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 Boston Beer are associated (or correlated) with Ascent Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascent Solar Technol has no effect on the direction of Boston Beer i.e., Boston Beer and Ascent Solar go up and down completely randomly.
Pair Corralation between Boston Beer and Ascent Solar
Considering the 90-day investment horizon Boston Beer is expected to generate 0.2 times more return on investment than Ascent Solar. However, Boston Beer is 5.0 times less risky than Ascent Solar. It trades about 0.03 of its potential returns per unit of risk. Ascent Solar Technologies, is currently generating about -0.12 per unit of risk. If you would invest 30,276 in Boston Beer on September 1, 2024 and sell it today you would earn a total of 1,348 from holding Boston Beer or generate 4.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Beer vs. Ascent Solar Technologies,
Performance |
| Timeline |
| Boston Beer |
| Ascent Solar Technol |
Boston Beer and Ascent Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Beer and Ascent Solar
The main advantage of trading using opposite Boston Beer and Ascent Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Beer position performs unexpectedly, Ascent Solar 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 Ascent Solar will offset losses from the drop in Ascent Solar's long position.| Boston Beer vs. Anheuser Busch Inbev | Boston Beer vs. Molson Coors Beverage | Boston Beer vs. Heineken NV | Boston Beer vs. Ambev SA ADR |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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