Correlation Between Altius Renewable and Heliogen

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

By analyzing existing cross correlation between Altius Renewable Royalties and Heliogen, you can compare the effects of market volatilities on Altius Renewable and Heliogen 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 Altius Renewable with a short position of Heliogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altius Renewable and Heliogen.

Diversification Opportunities for Altius Renewable and Heliogen

-0.1

Correlation Coefficient

Altius Renewable  Heliogen

Good diversification

The 3 months correlation between Altius and Heliogen is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Altius Renewable Royalties and Heliogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heliogen and Altius Renewable 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 Altius Renewable Royalties are associated (or correlated) with Heliogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heliogen has no effect on the direction of Altius Renewable i.e., Altius Renewable and Heliogen go up and down completely randomly.

Pair Corralation between Altius Renewable and Heliogen

Assuming the 90 days horizon Altius Renewable Royalties is expected to generate 0.22 times more return on investment than Heliogen. However, Altius Renewable Royalties is 4.47 times less risky than Heliogen. It trades about 0.04 of its potential returns per unit of risk. Heliogen is currently generating about -0.05 per unit of risk. If you would invest  676.00  in Altius Renewable Royalties on October 21, 2024 and sell it today you would earn a total of  174.00  from holding Altius Renewable Royalties or generate 25.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	26.01%
Values	Daily Returns

Altius Renewable Royalties  vs.  Heliogen

Altius Renewable Roy

Risk-Adjusted Performance

0 of 100

Very Weak

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

Heliogen

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Altius Renewable and Heliogen

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

The idea behind Altius Renewable Royalties and Heliogen 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.