Correlation Between Energous and Badger Meter
Can any of the company-specific risk be diversified away by investing in both Energous and Badger Meter 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 Energous and Badger Meter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energous and Badger Meter, you can compare the effects of market volatilities on Energous and Badger Meter 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 Energous with a short position of Badger Meter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energous and Badger Meter.
Diversification Opportunities for Energous and Badger Meter
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Energous and Badger is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Energous and Badger Meter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Badger Meter and Energous 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 Energous are associated (or correlated) with Badger Meter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Badger Meter has no effect on the direction of Energous i.e., Energous and Badger Meter go up and down completely randomly.
Pair Corralation between Energous and Badger Meter
Given the investment horizon of 90 days Energous is expected to under-perform the Badger Meter. In addition to that, Energous is 1.59 times more volatile than Badger Meter. It trades about -0.32 of its total potential returns per unit of risk. Badger Meter is currently generating about 0.18 per unit of volatility. If you would invest 20,267 in Badger Meter on August 24, 2024 and sell it today you would earn a total of 1,656 from holding Badger Meter or generate 8.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energous vs. Badger Meter
Performance |
| Timeline |
| Energous |
| Badger Meter |
Energous and Badger Meter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energous and Badger Meter
The main advantage of trading using opposite Energous and Badger Meter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energous position performs unexpectedly, Badger Meter 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 Badger Meter will offset losses from the drop in Badger Meter's long position.| Energous vs. Cepton Inc | Energous vs. SaverOne 2014 Ltd | Energous vs. Kraken Robotics | Energous vs. Focus Universal |
| Badger Meter vs. Coherent | Badger Meter vs. ESCO Technologies | Badger Meter vs. Mesa Laboratories | Badger Meter vs. Vishay Precision Group |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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