Correlation Between ZINC MEDIA and FuelCell Energy
Can any of the company-specific risk be diversified away by investing in both ZINC MEDIA and FuelCell Energy 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 ZINC MEDIA and FuelCell Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZINC MEDIA GR and FuelCell Energy, you can compare the effects of market volatilities on ZINC MEDIA and FuelCell Energy 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 ZINC MEDIA with a short position of FuelCell Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZINC MEDIA and FuelCell Energy.
Diversification Opportunities for ZINC MEDIA and FuelCell Energy
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ZINC and FuelCell is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding ZINC MEDIA GR and FuelCell Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FuelCell Energy and ZINC MEDIA 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 ZINC MEDIA GR are associated (or correlated) with FuelCell Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FuelCell Energy has no effect on the direction of ZINC MEDIA i.e., ZINC MEDIA and FuelCell Energy go up and down completely randomly.
Pair Corralation between ZINC MEDIA and FuelCell Energy
Assuming the 90 days trading horizon ZINC MEDIA GR is expected to under-perform the FuelCell Energy. But the stock apears to be less risky and, when comparing its historical volatility, ZINC MEDIA GR is 3.6 times less risky than FuelCell Energy. The stock trades about -0.05 of its potential returns per unit of risk. The FuelCell Energy is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 708.00 in FuelCell Energy on October 11, 2024 and sell it today you would earn a total of 514.00 from holding FuelCell Energy or generate 72.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.37% |
| Values | Daily Returns |
ZINC MEDIA GR vs. FuelCell Energy
Performance |
| Timeline |
| ZINC MEDIA GR |
| FuelCell Energy |
ZINC MEDIA and FuelCell Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZINC MEDIA and FuelCell Energy
The main advantage of trading using opposite ZINC MEDIA and FuelCell Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZINC MEDIA position performs unexpectedly, FuelCell Energy 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 FuelCell Energy will offset losses from the drop in FuelCell Energy's long position.| ZINC MEDIA vs. CARSALESCOM | ZINC MEDIA vs. Diamyd Medical AB | ZINC MEDIA vs. FAST RETAIL ADR | ZINC MEDIA vs. CompuGroup Medical SE |
| FuelCell Energy vs. Delta Electronics Public | FuelCell Energy vs. Superior Plus Corp | FuelCell Energy vs. NMI Holdings | FuelCell Energy vs. SIVERS SEMICONDUCTORS AB |
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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