Correlation Between Stag Industrial and ALERION CLEANPOWER
Can any of the company-specific risk be diversified away by investing in both Stag Industrial and ALERION CLEANPOWER 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 Stag Industrial and ALERION CLEANPOWER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stag Industrial and ALERION CLEANPOWER, you can compare the effects of market volatilities on Stag Industrial and ALERION CLEANPOWER 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 Stag Industrial with a short position of ALERION CLEANPOWER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stag Industrial and ALERION CLEANPOWER.
Diversification Opportunities for Stag Industrial and ALERION CLEANPOWER
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Stag and ALERION is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Stag Industrial and ALERION CLEANPOWER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALERION CLEANPOWER and Stag Industrial 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 Stag Industrial are associated (or correlated) with ALERION CLEANPOWER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALERION CLEANPOWER has no effect on the direction of Stag Industrial i.e., Stag Industrial and ALERION CLEANPOWER go up and down completely randomly.
Pair Corralation between Stag Industrial and ALERION CLEANPOWER
Assuming the 90 days trading horizon Stag Industrial is expected to generate 0.88 times more return on investment than ALERION CLEANPOWER. However, Stag Industrial is 1.13 times less risky than ALERION CLEANPOWER. It trades about 0.11 of its potential returns per unit of risk. ALERION CLEANPOWER is currently generating about -0.14 per unit of risk. If you would invest 3,259 in Stag Industrial on October 20, 2024 and sell it today you would earn a total of 85.00 from holding Stag Industrial or generate 2.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stag Industrial vs. ALERION CLEANPOWER
Performance |
| Timeline |
| Stag Industrial |
| ALERION CLEANPOWER |
Stag Industrial and ALERION CLEANPOWER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stag Industrial and ALERION CLEANPOWER
The main advantage of trading using opposite Stag Industrial and ALERION CLEANPOWER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stag Industrial position performs unexpectedly, ALERION CLEANPOWER 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 ALERION CLEANPOWER will offset losses from the drop in ALERION CLEANPOWER's long position.| Stag Industrial vs. Apple Inc | Stag Industrial vs. Apple Inc | Stag Industrial vs. Apple Inc | Stag Industrial vs. Apple Inc |
| ALERION CLEANPOWER vs. Altair Engineering | ALERION CLEANPOWER vs. Wizz Air Holdings | ALERION CLEANPOWER vs. Alaska Air Group | ALERION CLEANPOWER vs. SOGECLAIR SA INH |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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