Correlation Between Nuscale Power and Basanite
Can any of the company-specific risk be diversified away by investing in both Nuscale Power and Basanite 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 Nuscale Power and Basanite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuscale Power Corp and Basanite, you can compare the effects of market volatilities on Nuscale Power and Basanite 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 Nuscale Power with a short position of Basanite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuscale Power and Basanite.
Diversification Opportunities for Nuscale Power and Basanite
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nuscale and Basanite is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Nuscale Power Corp and Basanite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Basanite and Nuscale 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 Nuscale Power Corp are associated (or correlated) with Basanite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Basanite has no effect on the direction of Nuscale Power i.e., Nuscale Power and Basanite go up and down completely randomly.
Pair Corralation between Nuscale Power and Basanite
Considering the 90-day investment horizon Nuscale Power is expected to generate 1.24 times less return on investment than Basanite. But when comparing it to its historical volatility, Nuscale Power Corp is 1.75 times less risky than Basanite. It trades about 0.13 of its potential returns per unit of risk. Basanite is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1.50 in Basanite on November 5, 2024 and sell it today you would earn a total of 3.29 from holding Basanite or generate 219.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.65% |
| Values | Daily Returns |
Nuscale Power Corp vs. Basanite
Performance |
| Timeline |
| Nuscale Power Corp |
| Basanite |
Nuscale Power and Basanite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuscale Power and Basanite
The main advantage of trading using opposite Nuscale Power and Basanite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuscale Power position performs unexpectedly, Basanite 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 Basanite will offset losses from the drop in Basanite's long position.| Nuscale Power vs. Cummins | Nuscale Power vs. Chart Industries | Nuscale Power vs. GE Aerospace | Nuscale Power vs. Nel ASA |
| Basanite vs. Xinyi Glass Holdings | Basanite vs. CEMATRIX | Basanite vs. Anhui Conch Cement | Basanite vs. CEMEX SAB de |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |