Correlation Between Wind Works and Atlantic Wind

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

By analyzing existing cross correlation between Wind Works Power and Atlantic Wind Solar, you can compare the effects of market volatilities on Wind Works and Atlantic Wind 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 Wind Works with a short position of Atlantic Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wind Works and Atlantic Wind.

Diversification Opportunities for Wind Works and Atlantic Wind

0.0

Correlation Coefficient

Wind Works  Atlantic Wind

Pay attention - limited upside

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

Pair Corralation between Wind Works and Atlantic Wind

If you would invest  0.00  in Wind Works Power on September 13, 2024 and sell it today you would earn a total of  0.00  from holding Wind Works Power or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.88%
Values	Daily Returns

Wind Works Power  vs.  Atlantic Wind Solar

Wind Works Power

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wind Works Power has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Wind Works is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Atlantic Wind Solar

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atlantic Wind Solar 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 quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Wind Works and Atlantic Wind

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

The idea behind Wind Works Power and Atlantic Wind Solar 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.