Correlation Between Bloom Energy and Blue Sphere

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Can any of the company-specific risk be diversified away by investing in both Bloom Energy and Blue Sphere 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 Blue Sphere into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloom Energy Corp and Blue Sphere Corp, you can compare the effects of market volatilities on Bloom Energy and Blue Sphere 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 Blue Sphere. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Blue Sphere.

Diversification Opportunities for Bloom Energy and Blue Sphere

BloomBlueDiversified AwayBloomBlueDiversified Away100%
-0.21
  Correlation Coefficient

Very good diversification

The 3 months correlation between Bloom and Blue is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Bloom Energy Corp and Blue Sphere Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Sphere Corp 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 Corp are associated (or correlated) with Blue Sphere. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Sphere Corp has no effect on the direction of Bloom Energy i.e., Bloom Energy and Blue Sphere go up and down completely randomly.

Pair Corralation between Bloom Energy and Blue Sphere

Allowing for the 90-day total investment horizon Bloom Energy is expected to generate 368.1 times less return on investment than Blue Sphere. But when comparing it to its historical volatility, Bloom Energy Corp is 65.24 times less risky than Blue Sphere. It trades about 0.06 of its potential returns per unit of risk. Blue Sphere Corp is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Blue Sphere Corp on November 15, 2024 and sell it today you would lose (0.01) from holding Blue Sphere Corp or give up 100.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.31%
ValuesDaily Returns

Bloom Energy Corp  vs.  Blue Sphere Corp

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 050100150
JavaScript chart by amCharts 3.21.15BE BLSP
       Timeline  
Bloom Energy Corp 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Bloom Energy Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, Bloom Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb15202530
Blue Sphere Corp 

Risk-Adjusted Performance

Very Strong

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Blue Sphere Corp are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Blue Sphere reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb

Bloom Energy and Blue Sphere Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-28.52-21.36-14.2-7.040.127.5115.2823.0430.8138.58 0.00200.00250.00300.00350.00400.0045
JavaScript chart by amCharts 3.21.15BE BLSP
       Returns  

Pair Trading with Bloom Energy and Blue Sphere

The main advantage of trading using opposite Bloom Energy and Blue Sphere positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, Blue Sphere 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 Blue Sphere will offset losses from the drop in Blue Sphere's long position.
The idea behind Bloom Energy Corp and Blue Sphere 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.
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.

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