Correlation Between Clean Energy and Ensurge Micropower

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

By analyzing existing cross correlation between Clean Energy Pathway and Ensurge Micropower ASA, you can compare the effects of market volatilities on Clean Energy and Ensurge Micropower 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 Clean Energy with a short position of Ensurge Micropower. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clean Energy and Ensurge Micropower.

Diversification Opportunities for Clean Energy and Ensurge Micropower

0.0

Correlation Coefficient

Clean Energy  Ensurge Micropower

Pay attention - limited upside

The 3 months correlation between Clean and Ensurge is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Clean Energy Pathway and Ensurge Micropower ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensurge Micropower ASA and Clean 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 Clean Energy Pathway are associated (or correlated) with Ensurge Micropower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensurge Micropower ASA has no effect on the direction of Clean Energy i.e., Clean Energy and Ensurge Micropower go up and down completely randomly.

Pair Corralation between Clean Energy and Ensurge Micropower

If you would invest  38.00  in Ensurge Micropower ASA on December 28, 2024 and sell it today you would earn a total of  8.00  from holding Ensurge Micropower ASA or generate 21.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Clean Energy Pathway  vs.  Ensurge Micropower ASA

Clean Energy Pathway

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clean Energy Pathway has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Clean Energy is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ensurge Micropower ASA

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Ensurge Micropower ASA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Ensurge Micropower showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Clean Energy and Ensurge Micropower

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

The idea behind Clean Energy Pathway and Ensurge Micropower ASA 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.