Correlation Between Via Renewables and State Street

Can any of the company-specific risk be diversified away by investing in both Via Renewables and State Street 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 Via Renewables and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Via Renewables and State Street Institutional, you can compare the effects of market volatilities on Via Renewables and State Street 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 Via Renewables with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Via Renewables and State Street.

Diversification Opportunities for Via Renewables and State Street

0.18

Correlation Coefficient

Via Renewables  State Street

Average diversification

The 3 months correlation between Via and State is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Via Renewables and State Street Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Institu and Via Renewables 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 Via Renewables are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Institu has no effect on the direction of Via Renewables i.e., Via Renewables and State Street go up and down completely randomly.

Pair Corralation between Via Renewables and State Street

Assuming the 90 days horizon Via Renewables is expected to generate 0.64 times more return on investment than State Street. However, Via Renewables is 1.56 times less risky than State Street. It trades about 0.19 of its potential returns per unit of risk. State Street Institutional is currently generating about -0.07 per unit of risk. If you would invest  2,060  in Via Renewables on September 27, 2024 and sell it today you would earn a total of  280.00  from holding Via Renewables or generate 13.59% return on investment over 90 days.

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

Via Renewables  vs.  State Street Institutional

Via Renewables

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Via Renewables are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Via Renewables reported solid returns over the last few months and may actually be approaching a breakup point.

State Street Institu

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days State Street Institutional has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Via Renewables and State Street

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

The idea behind Via Renewables and State Street Institutional 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.