Correlation Between Bloom Energy and Delta Electronics

Can any of the company-specific risk be diversified away by investing in both Bloom Energy and Delta Electronics 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 Bloom Energy and Delta Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bloom Energy and Delta Electronics Public, you can compare the effects of market volatilities on Bloom Energy and Delta Electronics 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 Bloom Energy with a short position of Delta Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Delta Electronics.

Diversification Opportunities for Bloom Energy and Delta Electronics

0.72

Correlation Coefficient

Bloom Energy  Delta Electronics

Poor diversification

The 3 months correlation between Bloom and Delta is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy and Delta Electronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Electronics Public and Bloom Energy 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 Bloom Energy are associated (or correlated) with Delta Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Electronics Public has no effect on the direction of Bloom Energy i.e., Bloom Energy and Delta Electronics go up and down completely randomly.

Pair Corralation between Bloom Energy and Delta Electronics

Assuming the 90 days horizon Bloom Energy is expected to under-perform the Delta Electronics. In addition to that, Bloom Energy is 1.25 times more volatile than Delta Electronics Public. It trades about -0.09 of its total potential returns per unit of risk. Delta Electronics Public is currently generating about 0.16 per unit of volatility. If you would invest  386.00  in Delta Electronics Public on September 23, 2024 and sell it today you would earn a total of  44.00  from holding Delta Electronics Public or generate 11.4% return on investment over 90 days.

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

Bloom Energy  vs.  Delta Electronics Public

Bloom Energy

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bloom Energy are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Bloom Energy reported solid returns over the last few months and may actually be approaching a breakup point.

Delta Electronics Public

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Delta Electronics Public are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Delta Electronics reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Bloom Energy and Delta Electronics

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

The idea behind Bloom Energy and Delta Electronics Public 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.