Correlation Between Atlantic Wind and Clean Vision

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

By analyzing existing cross correlation between Atlantic Wind Solar and Clean Vision Corp, you can compare the effects of market volatilities on Atlantic Wind and Clean Vision 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 Atlantic Wind with a short position of Clean Vision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantic Wind and Clean Vision.

Diversification Opportunities for Atlantic Wind and Clean Vision

-0.42

Correlation Coefficient

Atlantic Wind  Clean Vision

Very good diversification

The 3 months correlation between Atlantic and Clean is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Atlantic Wind Solar and Clean Vision Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clean Vision Corp and Atlantic Wind 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 Atlantic Wind Solar are associated (or correlated) with Clean Vision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clean Vision Corp has no effect on the direction of Atlantic Wind i.e., Atlantic Wind and Clean Vision go up and down completely randomly.

Pair Corralation between Atlantic Wind and Clean Vision

Given the investment horizon of 90 days Atlantic Wind Solar is expected to generate 1.01 times more return on investment than Clean Vision. However, Atlantic Wind is 1.01 times more volatile than Clean Vision Corp. It trades about 0.33 of its potential returns per unit of risk. Clean Vision Corp is currently generating about 0.01 per unit of risk. If you would invest  3.41  in Atlantic Wind Solar on December 1, 2024 and sell it today you would earn a total of  1.79  from holding Atlantic Wind Solar or generate 52.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Atlantic Wind Solar  vs.  Clean Vision Corp

Atlantic Wind Solar

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Atlantic Wind Solar are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent basic indicators, Atlantic Wind disclosed solid returns over the last few months and may actually be approaching a breakup point.

Clean Vision Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clean Vision Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Atlantic Wind and Clean Vision

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

The idea behind Atlantic Wind Solar and Clean Vision Corp 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.