Correlation Between Alpha One and Thunder Bridge

Can any of the company-specific risk be diversified away by investing in both Alpha One and Thunder Bridge 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 Alpha One and Thunder Bridge into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alpha One and Thunder Bridge Capital, you can compare the effects of market volatilities on Alpha One and Thunder Bridge 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 Alpha One with a short position of Thunder Bridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha One and Thunder Bridge.

Diversification Opportunities for Alpha One and Thunder Bridge

0.0

Correlation Coefficient

Alpha One  Thunder Bridge

Pay attention - limited upside

The 3 months correlation between Alpha and Thunder is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alpha One and Thunder Bridge Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thunder Bridge Capital and Alpha One 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 Alpha One are associated (or correlated) with Thunder Bridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thunder Bridge Capital has no effect on the direction of Alpha One i.e., Alpha One and Thunder Bridge go up and down completely randomly.

Pair Corralation between Alpha One and Thunder Bridge

If you would invest  1,049  in Thunder Bridge Capital on September 17, 2024 and sell it today you would earn a total of  175.00  from holding Thunder Bridge Capital or generate 16.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	93.85%
Values	Daily Returns

Alpha One  vs.  Thunder Bridge Capital

Alpha One

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alpha One has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Alpha One is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Thunder Bridge Capital

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Thunder Bridge Capital are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain fundamental indicators, Thunder Bridge reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alpha One and Thunder Bridge

The main advantage of trading using opposite Alpha One and Thunder Bridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha One position performs unexpectedly, Thunder Bridge 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 Thunder Bridge will offset losses from the drop in Thunder Bridge's long position.

The idea behind Alpha One and Thunder Bridge Capital pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.