Correlation Between Clean Energy and AAC TECHNOLOGHLDGADR

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

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

Diversification Opportunities for Clean Energy and AAC TECHNOLOGHLDGADR

-0.52

Correlation Coefficient

Clean Energy  AAC TECHNOLOGHLDGADR

Excellent diversification

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

Pair Corralation between Clean Energy and AAC TECHNOLOGHLDGADR

Assuming the 90 days horizon Clean Energy Fuels is expected to under-perform the AAC TECHNOLOGHLDGADR. In addition to that, Clean Energy is 1.15 times more volatile than AAC TECHNOLOGHLDGADR. It trades about -0.13 of its total potential returns per unit of risk. AAC TECHNOLOGHLDGADR is currently generating about 0.11 per unit of volatility. If you would invest  448.00  in AAC TECHNOLOGHLDGADR on December 28, 2024 and sell it today you would earn a total of  112.00  from holding AAC TECHNOLOGHLDGADR or generate 25.0% return on investment over 90 days.

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

Clean Energy Fuels  vs.  AAC TECHNOLOGHLDGADR

Clean Energy Fuels

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clean Energy Fuels has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

AAC TECHNOLOGHLDGADR

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AAC TECHNOLOGHLDGADR are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, AAC TECHNOLOGHLDGADR reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Clean Energy and AAC TECHNOLOGHLDGADR

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

The idea behind Clean Energy Fuels and AAC TECHNOLOGHLDGADR 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.