Correlation Between Leroy Seafood and Clean Power

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

By analyzing existing cross correlation between Leroy Seafood Group and Clean Power Hydrogen, you can compare the effects of market volatilities on Leroy Seafood and Clean Power 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 Leroy Seafood with a short position of Clean Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leroy Seafood and Clean Power.

Diversification Opportunities for Leroy Seafood and Clean Power

0.25

Correlation Coefficient

Leroy Seafood  Clean Power

Modest diversification

The 3 months correlation between Leroy and Clean is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Leroy Seafood Group and Clean Power Hydrogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Power Hydrogen and Leroy Seafood 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 Leroy Seafood Group are associated (or correlated) with Clean Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Power Hydrogen has no effect on the direction of Leroy Seafood i.e., Leroy Seafood and Clean Power go up and down completely randomly.

Pair Corralation between Leroy Seafood and Clean Power

Assuming the 90 days trading horizon Leroy Seafood Group is expected to generate 0.41 times more return on investment than Clean Power. However, Leroy Seafood Group is 2.46 times less risky than Clean Power. It trades about 0.01 of its potential returns per unit of risk. Clean Power Hydrogen is currently generating about -0.03 per unit of risk. If you would invest  4,971  in Leroy Seafood Group on October 11, 2024 and sell it today you would lose (56.00) from holding Leroy Seafood Group or give up 1.13% of portfolio value over 90 days.

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

Leroy Seafood Group  vs.  Clean Power Hydrogen

Leroy Seafood Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leroy Seafood Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Leroy Seafood is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Clean Power Hydrogen

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clean Power Hydrogen has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Leroy Seafood and Clean Power

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

The idea behind Leroy Seafood Group and Clean Power Hydrogen 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.