Correlation Between Tigo Energy and Blue Capital

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

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

Diversification Opportunities for Tigo Energy and Blue Capital

-0.49

Correlation Coefficient

Tigo Energy  Blue Capital

Very good diversification

The 3 months correlation between Tigo and Blue is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Tigo Energy and Blue Capital Reinsurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Capital Reinsurance and Tigo 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 Tigo Energy are associated (or correlated) with Blue Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Capital Reinsurance has no effect on the direction of Tigo Energy i.e., Tigo Energy and Blue Capital go up and down completely randomly.

Pair Corralation between Tigo Energy and Blue Capital

If you would invest  85.00  in Tigo Energy on October 12, 2024 and sell it today you would earn a total of  9.00  from holding Tigo Energy or generate 10.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	5.0%
Values	Daily Returns

Tigo Energy  vs.  Blue Capital Reinsurance

Tigo Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tigo Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Blue Capital Reinsurance

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blue Capital Reinsurance has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical indicators, Blue Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Tigo Energy and Blue Capital

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

The idea behind Tigo Energy and Blue Capital Reinsurance 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.