Correlation Between Standex International and Clean Energy
Can any of the company-specific risk be diversified away by investing in both Standex International and Clean Energy 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 Standex International and Clean Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Standex International and Clean Energy Technologies,, you can compare the effects of market volatilities on Standex International and Clean Energy 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 Standex International with a short position of Clean Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standex International and Clean Energy.
Diversification Opportunities for Standex International and Clean Energy
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Standex and Clean is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Standex International and Clean Energy Technologies, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Energy Technol and Standex International 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 Standex International are associated (or correlated) with Clean Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Energy Technol has no effect on the direction of Standex International i.e., Standex International and Clean Energy go up and down completely randomly.
Pair Corralation between Standex International and Clean Energy
Considering the 90-day investment horizon Standex International is expected to generate 0.4 times more return on investment than Clean Energy. However, Standex International is 2.52 times less risky than Clean Energy. It trades about 0.29 of its potential returns per unit of risk. Clean Energy Technologies, is currently generating about 0.11 per unit of risk. If you would invest 17,909 in Standex International on August 28, 2024 and sell it today you would earn a total of 3,243 from holding Standex International or generate 18.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Standex International vs. Clean Energy Technologies,
Performance |
| Timeline |
| Standex International |
| Clean Energy Technol |
Standex International and Clean Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Standex International and Clean Energy
The main advantage of trading using opposite Standex International and Clean Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Standex International position performs unexpectedly, Clean Energy 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 Clean Energy will offset losses from the drop in Clean Energy's long position.The idea behind Standex International and Clean Energy Technologies, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Clean Energy vs. US Nuclear Corp | Clean Energy vs. Puration | Clean Energy vs. Appswarm | Clean Energy vs. Sun Pacific Holding |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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