Correlation Between Thermal Energy and Clear Blue
Can any of the company-specific risk be diversified away by investing in both Thermal Energy and Clear Blue 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 Thermal Energy and Clear Blue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thermal Energy International and Clear Blue Technologies, you can compare the effects of market volatilities on Thermal Energy and Clear Blue 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 Thermal Energy with a short position of Clear Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thermal Energy and Clear Blue.
Diversification Opportunities for Thermal Energy and Clear Blue
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thermal and Clear is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Thermal Energy International and Clear Blue Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clear Blue Technologies and Thermal Energy 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 Thermal Energy International are associated (or correlated) with Clear Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clear Blue Technologies has no effect on the direction of Thermal Energy i.e., Thermal Energy and Clear Blue go up and down completely randomly.
Pair Corralation between Thermal Energy and Clear Blue
Assuming the 90 days horizon Thermal Energy International is expected to under-perform the Clear Blue. But the stock apears to be less risky and, when comparing its historical volatility, Thermal Energy International is 2.82 times less risky than Clear Blue. The stock trades about -0.02 of its potential returns per unit of risk. The Clear Blue Technologies is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 7.50 in Clear Blue Technologies on August 25, 2024 and sell it today you would lose (5.50) from holding Clear Blue Technologies or give up 73.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.47% |
| Values | Daily Returns |
Thermal Energy International vs. Clear Blue Technologies
Performance |
| Timeline |
| Thermal Energy Inter |
| Clear Blue Technologies |
Thermal Energy and Clear Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thermal Energy and Clear Blue
The main advantage of trading using opposite Thermal Energy and Clear Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thermal Energy position performs unexpectedly, Clear Blue 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 Clear Blue will offset losses from the drop in Clear Blue's long position.| Thermal Energy vs. Clear Blue Technologies | Thermal Energy vs. Current Water Technologies | Thermal Energy vs. Aurora Solar Technologies |
| Clear Blue vs. Aurora Solar Technologies | Clear Blue vs. Environmental Waste International | Clear Blue vs. Lite Access Technologies | Clear Blue vs. Solar Alliance Energy |
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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