Correlation Between Cleantech Power and Where Food

Can any of the company-specific risk be diversified away by investing in both Cleantech Power and Where Food 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 Cleantech Power and Where Food into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Cleantech Power Corp and Where Food Comes, you can compare the effects of market volatilities on Cleantech Power and Where Food 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 Cleantech Power with a short position of Where Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cleantech Power and Where Food.

Diversification Opportunities for Cleantech Power and Where Food

0.0

Correlation Coefficient

Cleantech Power  Where Food

Pay attention - limited upside

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

Pair Corralation between Cleantech Power and Where Food

Assuming the 90 days horizon Cleantech Power Corp is expected to generate 24.98 times more return on investment than Where Food. However, Cleantech Power is 24.98 times more volatile than Where Food Comes. It trades about 0.06 of its potential returns per unit of risk. Where Food Comes is currently generating about 0.0 per unit of risk. If you would invest  1.00  in Cleantech Power Corp on September 20, 2024 and sell it today you would lose (0.41) from holding Cleantech Power Corp or give up 41.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Cleantech Power Corp  vs.  Where Food Comes

Cleantech Power Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cleantech Power Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Cleantech Power is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Where Food Comes

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Where Food Comes are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal fundamental indicators, Where Food reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cleantech Power and Where Food

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

The idea behind Cleantech Power Corp and Where Food Comes 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.

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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.