Correlation Between Brenmiller Energy and Mill City

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

By analyzing existing cross correlation between Brenmiller Energy Ltd and Mill City Ventures, you can compare the effects of market volatilities on Brenmiller Energy and Mill City 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 Brenmiller Energy with a short position of Mill City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brenmiller Energy and Mill City.

Diversification Opportunities for Brenmiller Energy and Mill City

0.81

Correlation Coefficient

Brenmiller Energy  Mill City

Very poor diversification

The 3 months correlation between Brenmiller and Mill is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Brenmiller Energy Ltd and Mill City Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mill City Ventures and Brenmiller 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 Brenmiller Energy Ltd are associated (or correlated) with Mill City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mill City Ventures has no effect on the direction of Brenmiller Energy i.e., Brenmiller Energy and Mill City go up and down completely randomly.

Pair Corralation between Brenmiller Energy and Mill City

Given the investment horizon of 90 days Brenmiller Energy Ltd is expected to under-perform the Mill City. In addition to that, Brenmiller Energy is 1.33 times more volatile than Mill City Ventures. It trades about -0.04 of its total potential returns per unit of risk. Mill City Ventures is currently generating about 0.05 per unit of volatility. If you would invest  192.00  in Mill City Ventures on September 18, 2024 and sell it today you would earn a total of  4.00  from holding Mill City Ventures or generate 2.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.24%
Values	Daily Returns

Brenmiller Energy Ltd  vs.  Mill City Ventures

Brenmiller Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Brenmiller Energy Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Mill City Ventures

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Brenmiller Energy and Mill City

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

The idea behind Brenmiller Energy Ltd and Mill City Ventures 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.