Correlation Between Greenlane Renewables and Dexterra

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

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

Diversification Opportunities for Greenlane Renewables and Dexterra

0.52

Correlation Coefficient

Greenlane Renewables  Dexterra

Very weak diversification

The 3 months correlation between Greenlane and Dexterra is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Greenlane Renewables and Dexterra Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dexterra Group and Greenlane Renewables 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 Greenlane Renewables are associated (or correlated) with Dexterra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dexterra Group has no effect on the direction of Greenlane Renewables i.e., Greenlane Renewables and Dexterra go up and down completely randomly.

Pair Corralation between Greenlane Renewables and Dexterra

Assuming the 90 days trading horizon Greenlane Renewables is expected to under-perform the Dexterra. In addition to that, Greenlane Renewables is 5.89 times more volatile than Dexterra Group. It trades about -0.01 of its total potential returns per unit of risk. Dexterra Group is currently generating about 0.44 per unit of volatility. If you would invest  704.00  in Dexterra Group on September 25, 2024 and sell it today you would earn a total of  71.00  from holding Dexterra Group or generate 10.09% return on investment over 90 days.

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

Greenlane Renewables  vs.  Dexterra Group

Greenlane Renewables

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Greenlane Renewables are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Greenlane Renewables displayed solid returns over the last few months and may actually be approaching a breakup point.

Dexterra Group

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dexterra Group are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Dexterra displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Greenlane Renewables and Dexterra

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

The idea behind Greenlane Renewables and Dexterra Group 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.