Correlation Between Excelerate Energy and Brenmiller Energy

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

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

Diversification Opportunities for Excelerate Energy and Brenmiller Energy

0.3

Correlation Coefficient

Excelerate Energy  Brenmiller Energy

Weak diversification

The 3 months correlation between Excelerate and Brenmiller is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Excelerate Energy and Brenmiller Energy Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brenmiller Energy and Excelerate 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 Excelerate Energy are associated (or correlated) with Brenmiller Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brenmiller Energy has no effect on the direction of Excelerate Energy i.e., Excelerate Energy and Brenmiller Energy go up and down completely randomly.

Pair Corralation between Excelerate Energy and Brenmiller Energy

Allowing for the 90-day total investment horizon Excelerate Energy is expected to under-perform the Brenmiller Energy. But the stock apears to be less risky and, when comparing its historical volatility, Excelerate Energy is 4.11 times less risky than Brenmiller Energy. The stock trades about -0.04 of its potential returns per unit of risk. The Brenmiller Energy Ltd is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  130.00  in Brenmiller Energy Ltd on December 31, 2024 and sell it today you would earn a total of  2.00  from holding Brenmiller Energy Ltd or generate 1.54% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Excelerate Energy  vs.  Brenmiller Energy Ltd

Excelerate Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Excelerate Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Excelerate Energy is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Brenmiller Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Brenmiller Energy Ltd are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Brenmiller Energy reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Excelerate Energy and Brenmiller Energy

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

The idea behind Excelerate Energy and Brenmiller Energy Ltd 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..