Correlation Between Cleantech Power and Anheuser Busch

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

Diversification Opportunities for Cleantech Power and Anheuser Busch

CleantechAnheuserDiversified AwayCleantechAnheuserDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Cleantech Power and Anheuser Busch

If you would invest  0.59  in Cleantech Power Corp on September 20, 2024 and sell it today you would earn a total of  0.00  from holding Cleantech Power Corp or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy98.44%
ValuesDaily Returns

Cleantech Power Corp  vs.  Anheuser Busch Inbev

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -15-10-50
JavaScript chart by amCharts 3.21.15PWWRF BUD
       Timeline  
Cleantech Power Corp 

Risk-Adjusted Performance

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Over the last 90 days Cleantech Power Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Cleantech Power is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec0.0050.00510.00520.00530.00540.00550.00560.00570.00580.0059
Anheuser Busch Inbev 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Anheuser Busch Inbev has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec50556065

Cleantech Power and Anheuser Busch Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15 0.050.100.150.200.25
JavaScript chart by amCharts 3.21.15PWWRF BUD
       Returns  

Pair Trading with Cleantech Power and Anheuser Busch

The main advantage of trading using opposite Cleantech Power and Anheuser Busch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cleantech Power position performs unexpectedly, Anheuser Busch 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 Anheuser Busch will offset losses from the drop in Anheuser Busch's long position.
The idea behind Cleantech Power Corp and Anheuser Busch Inbev 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

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