Correlation Between Scatec Solar and Everfuel
Can any of the company-specific risk be diversified away by investing in both Scatec Solar and Everfuel 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 Scatec Solar and Everfuel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scatec Solar OL and Everfuel AS, you can compare the effects of market volatilities on Scatec Solar and Everfuel 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 Scatec Solar with a short position of Everfuel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scatec Solar and Everfuel.
Diversification Opportunities for Scatec Solar and Everfuel
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Scatec and Everfuel is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Scatec Solar OL and Everfuel AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everfuel AS and Scatec Solar 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 Scatec Solar OL are associated (or correlated) with Everfuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everfuel AS has no effect on the direction of Scatec Solar i.e., Scatec Solar and Everfuel go up and down completely randomly.
Pair Corralation between Scatec Solar and Everfuel
Assuming the 90 days trading horizon Scatec Solar is expected to generate 16.48 times less return on investment than Everfuel. But when comparing it to its historical volatility, Scatec Solar OL is 2.16 times less risky than Everfuel. It trades about 0.01 of its potential returns per unit of risk. Everfuel AS is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 793.00 in Everfuel AS on August 25, 2024 and sell it today you would earn a total of 479.00 from holding Everfuel AS or generate 60.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scatec Solar OL vs. Everfuel AS
Performance |
| Timeline |
| Scatec Solar OL |
| Everfuel AS |
Scatec Solar and Everfuel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scatec Solar and Everfuel
The main advantage of trading using opposite Scatec Solar and Everfuel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scatec Solar position performs unexpectedly, Everfuel 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 Everfuel will offset losses from the drop in Everfuel's long position.| Scatec Solar vs. Aker Carbon Capture | Scatec Solar vs. Elkem ASA | Scatec Solar vs. Vow ASA | Scatec Solar vs. North Energy ASA |
| Everfuel vs. Scatec Solar OL | Everfuel vs. Aker Carbon Capture | Everfuel vs. Elkem ASA | Everfuel vs. Vow ASA |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |