Correlation Between Veren and Brenmiller Energy

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

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

Diversification Opportunities for Veren and Brenmiller Energy

0.64

Correlation Coefficient

Veren  Brenmiller Energy

Poor diversification

The 3 months correlation between Veren and Brenmiller is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Veren Inc and Brenmiller Energy Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brenmiller Energy and Veren 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 Veren Inc 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 Veren i.e., Veren and Brenmiller Energy go up and down completely randomly.

Pair Corralation between Veren and Brenmiller Energy

Considering the 90-day investment horizon Veren is expected to generate 9.25 times less return on investment than Brenmiller Energy. But when comparing it to its historical volatility, Veren Inc is 4.51 times less risky than Brenmiller Energy. It trades about 0.07 of its potential returns per unit of risk. Brenmiller Energy Ltd is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  82.00  in Brenmiller Energy Ltd on December 4, 2024 and sell it today you would earn a total of  62.00  from holding Brenmiller Energy Ltd or generate 75.61% return on investment over 90 days.

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

Veren Inc  vs.  Brenmiller Energy Ltd

Veren Inc

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Veren Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Veren may actually be approaching a critical reversion point that can send shares even higher in April 2025.

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 10 (%) 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 Veren and Brenmiller Energy

The main advantage of trading using opposite Veren and Brenmiller Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veren 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 Veren Inc 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.

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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.