Correlation Between Vast Renewables and Consolidated Edison
Can any of the company-specific risk be diversified away by investing in both Vast Renewables and Consolidated Edison 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 Vast Renewables and Consolidated Edison into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vast Renewables Limited and Consolidated Edison, you can compare the effects of market volatilities on Vast Renewables and Consolidated Edison 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 Vast Renewables with a short position of Consolidated Edison. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vast Renewables and Consolidated Edison.
Diversification Opportunities for Vast Renewables and Consolidated Edison
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vast and Consolidated is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Vast Renewables Limited and Consolidated Edison in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consolidated Edison and Vast 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 Vast Renewables Limited are associated (or correlated) with Consolidated Edison. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consolidated Edison has no effect on the direction of Vast Renewables i.e., Vast Renewables and Consolidated Edison go up and down completely randomly.
Pair Corralation between Vast Renewables and Consolidated Edison
Assuming the 90 days horizon Vast Renewables Limited is expected to generate 11.18 times more return on investment than Consolidated Edison. However, Vast Renewables is 11.18 times more volatile than Consolidated Edison. It trades about 0.0 of its potential returns per unit of risk. Consolidated Edison is currently generating about -0.07 per unit of risk. If you would invest 11.00 in Vast Renewables Limited on November 1, 2024 and sell it today you would lose (4.65) from holding Vast Renewables Limited or give up 42.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vast Renewables Limited vs. Consolidated Edison
Performance |
| Timeline |
| Vast Renewables |
| Consolidated Edison |
Vast Renewables and Consolidated Edison Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vast Renewables and Consolidated Edison
The main advantage of trading using opposite Vast Renewables and Consolidated Edison positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vast Renewables position performs unexpectedly, Consolidated Edison 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 Consolidated Edison will offset losses from the drop in Consolidated Edison's long position.| Vast Renewables vs. Major Drilling Group | Vast Renewables vs. Radian Group | Vast Renewables vs. Alignment Healthcare LLC | Vast Renewables vs. Loews Corp |
| Consolidated Edison vs. Duke Energy | Consolidated Edison vs. Dominion Energy | Consolidated Edison vs. American Electric Power | Consolidated Edison vs. Nextera 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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