diversifiable risk of combining Bloom Energy and Electrovaya Common into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloom Energy Corp and Electrovaya Common Shares, you can compare the effects of market volatilities on Bloom Energy and Electrovaya Common 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 Bloom Energy with a short position of Electrovaya Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloom Energy and Electrovaya Common.
Diversification Opportunities for Bloom Energy and Electrovaya Common
Pair Corralation between Bloom Energy and Electrovaya Common
Allowing for the 90-day total investment horizon Bloom Energy Corp is expected to under-perform the Electrovaya Common. In addition to that, Bloom Energy is 1.03 times more volatile than Electrovaya Common Shares. It trades about -0.02 of its total potential returns per unit of risk. Electrovaya Common Shares is currently generating about 0.03 per unit of volatility. If you would invest 325.00 in Electrovaya Common Shares on December 3, 2023 and sell it today you would earn a total of 79.00 from holding Electrovaya Common Shares or generate 24.31% return on investment over 90 days.
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Bloom Energy Corp vs. Electrovaya Common Shares
Bloom Energy and Electrovaya Common Volatility Contrast
Pair Trading with Bloom Energy and Electrovaya CommonThe main advantage of trading using opposite Bloom Energy and Electrovaya Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloom Energy position performs unexpectedly, Electrovaya Common 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 Electrovaya Common will offset losses from the drop in Electrovaya Common's long position. The idea behind Bloom Energy Corp and Electrovaya Common Shares 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.
Check out your portfolio center.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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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