Correlation Between Via Renewables and Federated
Can any of the company-specific risk be diversified away by investing in both Via Renewables and Federated 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 Via Renewables and Federated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Via Renewables and Federated U S, you can compare the effects of market volatilities on Via Renewables and Federated 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 Via Renewables with a short position of Federated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Via Renewables and Federated.
Diversification Opportunities for Via Renewables and Federated
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Via and Federated is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Via Renewables and Federated U S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated U S and Via Renewables 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 Via Renewables are associated (or correlated) with Federated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated U S has no effect on the direction of Via Renewables i.e., Via Renewables and Federated go up and down completely randomly.
Pair Corralation between Via Renewables and Federated
Assuming the 90 days horizon Via Renewables is expected to generate 16.56 times more return on investment than Federated. However, Via Renewables is 16.56 times more volatile than Federated U S. It trades about 0.09 of its potential returns per unit of risk. Federated U S is currently generating about 0.12 per unit of risk. If you would invest 1,133 in Via Renewables on September 12, 2024 and sell it today you would earn a total of 1,077 from holding Via Renewables or generate 95.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Via Renewables vs. Federated U S
Performance |
| Timeline |
| Via Renewables |
| Federated U S |
Via Renewables and Federated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Via Renewables and Federated
The main advantage of trading using opposite Via Renewables and Federated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Via Renewables position performs unexpectedly, Federated 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 Federated will offset losses from the drop in Federated's long position.| Via Renewables vs. CMS Energy | Via Renewables vs. ACRES Commercial Realty | Via Renewables vs. Atlanticus Holdings Corp |
| Federated vs. SCOR PK | Federated vs. Morningstar Unconstrained Allocation | Federated vs. Via Renewables | Federated vs. Bondbloxx ETF Trust |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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