Correlation Between Vistra Energy and Fluent
Can any of the company-specific risk be diversified away by investing in both Vistra Energy and Fluent 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 Vistra Energy and Fluent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vistra Energy Corp and Fluent Inc, you can compare the effects of market volatilities on Vistra Energy and Fluent 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 Vistra Energy with a short position of Fluent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vistra Energy and Fluent.
Diversification Opportunities for Vistra Energy and Fluent
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Vistra and Fluent is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Vistra Energy Corp and Fluent Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fluent Inc and Vistra 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 Vistra Energy Corp are associated (or correlated) with Fluent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fluent Inc has no effect on the direction of Vistra Energy i.e., Vistra Energy and Fluent go up and down completely randomly.
Pair Corralation between Vistra Energy and Fluent
Considering the 90-day investment horizon Vistra Energy Corp is expected to generate 0.97 times more return on investment than Fluent. However, Vistra Energy Corp is 1.04 times less risky than Fluent. It trades about 0.13 of its potential returns per unit of risk. Fluent Inc is currently generating about -0.02 per unit of risk. If you would invest 9,154 in Vistra Energy Corp on September 3, 2024 and sell it today you would earn a total of 6,830 from holding Vistra Energy Corp or generate 74.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vistra Energy Corp vs. Fluent Inc
Performance |
| Timeline |
| Vistra Energy Corp |
| Fluent Inc |
Vistra Energy and Fluent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vistra Energy and Fluent
The main advantage of trading using opposite Vistra Energy and Fluent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vistra Energy position performs unexpectedly, Fluent 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 Fluent will offset losses from the drop in Fluent's long position.| Vistra Energy vs. Pampa Energia SA | Vistra Energy vs. TransAlta Corp | Vistra Energy vs. Kenon Holdings | Vistra Energy vs. NRG Energy |
| Fluent vs. Marchex | Fluent vs. Dolphin Entertainment | Fluent vs. Beyond Commerce | Fluent vs. MGO Global Common |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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