Correlation Between Thermal Energy and Northstar Clean
Can any of the company-specific risk be diversified away by investing in both Thermal Energy and Northstar Clean 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 Northstar Clean 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 Northstar Clean Technologies, you can compare the effects of market volatilities on Thermal Energy and Northstar Clean 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 Northstar Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thermal Energy and Northstar Clean.
Diversification Opportunities for Thermal Energy and Northstar Clean
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Thermal and Northstar is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Thermal Energy International and Northstar Clean Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northstar Clean Tech 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 Northstar Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northstar Clean Tech has no effect on the direction of Thermal Energy i.e., Thermal Energy and Northstar Clean go up and down completely randomly.
Pair Corralation between Thermal Energy and Northstar Clean
Assuming the 90 days horizon Thermal Energy International is expected to under-perform the Northstar Clean. In addition to that, Thermal Energy is 1.18 times more volatile than Northstar Clean Technologies. It trades about -0.01 of its total potential returns per unit of risk. Northstar Clean Technologies is currently generating about 0.18 per unit of volatility. If you would invest 19.00 in Northstar Clean Technologies on August 29, 2024 and sell it today you would earn a total of 9.00 from holding Northstar Clean Technologies or generate 47.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.41% |
| Values | Daily Returns |
Thermal Energy International vs. Northstar Clean Technologies
Performance |
| Timeline |
| Thermal Energy Inter |
| Northstar Clean Tech |
Thermal Energy and Northstar Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thermal Energy and Northstar Clean
The main advantage of trading using opposite Thermal Energy and Northstar Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thermal Energy position performs unexpectedly, Northstar Clean 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 Northstar Clean will offset losses from the drop in Northstar Clean's long position.| Thermal Energy vs. Environmental Waste International | Thermal Energy vs. Aurora Solar Technologies | Thermal Energy vs. Eguana Technologies | Thermal Energy vs. BioRem Inc |
| Northstar Clean vs. Cielo Waste Solutions | Northstar Clean vs. CHAR Technologies | Northstar Clean vs. Forstrong Global Income | Northstar Clean vs. Terreno Resources Corp |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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