Correlation Between VivoPower International and Aemetis
Can any of the company-specific risk be diversified away by investing in both VivoPower International and Aemetis 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 VivoPower International and Aemetis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VivoPower International PLC and Aemetis, you can compare the effects of market volatilities on VivoPower International and Aemetis 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 VivoPower International with a short position of Aemetis. Check out your portfolio center. Please also check ongoing floating volatility patterns of VivoPower International and Aemetis.
Diversification Opportunities for VivoPower International and Aemetis
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VivoPower and Aemetis is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding VivoPower International PLC and Aemetis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aemetis and VivoPower International 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 VivoPower International PLC are associated (or correlated) with Aemetis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aemetis has no effect on the direction of VivoPower International i.e., VivoPower International and Aemetis go up and down completely randomly.
Pair Corralation between VivoPower International and Aemetis
Given the investment horizon of 90 days VivoPower International PLC is expected to generate 4.08 times more return on investment than Aemetis. However, VivoPower International is 4.08 times more volatile than Aemetis. It trades about 0.05 of its potential returns per unit of risk. Aemetis is currently generating about 0.04 per unit of risk. If you would invest 143.00 in VivoPower International PLC on August 25, 2024 and sell it today you would lose (51.00) from holding VivoPower International PLC or give up 35.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VivoPower International PLC vs. Aemetis
Performance |
| Timeline |
| VivoPower International |
| Aemetis |
VivoPower International and Aemetis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VivoPower International and Aemetis
The main advantage of trading using opposite VivoPower International and Aemetis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VivoPower International position performs unexpectedly, Aemetis 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 Aemetis will offset losses from the drop in Aemetis' long position.| VivoPower International vs. Emeren Group | VivoPower International vs. Tigo Energy | VivoPower International vs. Sunrun Inc | VivoPower International vs. Sunnova Energy International |
| Aemetis vs. PBF Energy | Aemetis vs. Clean Energy Fuels | Aemetis vs. Par Pacific Holdings | Aemetis vs. Vertex 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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