Correlation Between Allegheny Technologies and ORMAT TECHNOLOGIES
Can any of the company-specific risk be diversified away by investing in both Allegheny Technologies and ORMAT TECHNOLOGIES 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 Allegheny Technologies and ORMAT TECHNOLOGIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allegheny Technologies Incorporated and ORMAT TECHNOLOGIES, you can compare the effects of market volatilities on Allegheny Technologies and ORMAT TECHNOLOGIES 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 Allegheny Technologies with a short position of ORMAT TECHNOLOGIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allegheny Technologies and ORMAT TECHNOLOGIES.
Diversification Opportunities for Allegheny Technologies and ORMAT TECHNOLOGIES
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Allegheny and ORMAT is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Allegheny Technologies Incorpo and ORMAT TECHNOLOGIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ORMAT TECHNOLOGIES and Allegheny Technologies 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 Allegheny Technologies Incorporated are associated (or correlated) with ORMAT TECHNOLOGIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ORMAT TECHNOLOGIES has no effect on the direction of Allegheny Technologies i.e., Allegheny Technologies and ORMAT TECHNOLOGIES go up and down completely randomly.
Pair Corralation between Allegheny Technologies and ORMAT TECHNOLOGIES
Assuming the 90 days trading horizon Allegheny Technologies Incorporated is expected to generate 1.48 times more return on investment than ORMAT TECHNOLOGIES. However, Allegheny Technologies is 1.48 times more volatile than ORMAT TECHNOLOGIES. It trades about 0.23 of its potential returns per unit of risk. ORMAT TECHNOLOGIES is currently generating about 0.16 per unit of risk. If you would invest 6,192 in Allegheny Technologies Incorporated on August 19, 2025 and sell it today you would earn a total of 2,396 from holding Allegheny Technologies Incorporated or generate 38.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allegheny Technologies Incorpo vs. ORMAT TECHNOLOGIES
Performance |
| Timeline |
| Allegheny Technologies |
| ORMAT TECHNOLOGIES |
Allegheny Technologies and ORMAT TECHNOLOGIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allegheny Technologies and ORMAT TECHNOLOGIES
The main advantage of trading using opposite Allegheny Technologies and ORMAT TECHNOLOGIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allegheny Technologies position performs unexpectedly, ORMAT TECHNOLOGIES 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 ORMAT TECHNOLOGIES will offset losses from the drop in ORMAT TECHNOLOGIES's long position.| Allegheny Technologies vs. Apple Inc | Allegheny Technologies vs. Apple Inc | Allegheny Technologies vs. Apple Inc | Allegheny Technologies vs. Apple Inc |
| ORMAT TECHNOLOGIES vs. Gamma Communications plc | ORMAT TECHNOLOGIES vs. JLT MOBILE PUTER | ORMAT TECHNOLOGIES vs. Aedas Homes SA | ORMAT TECHNOLOGIES vs. Zoom Video Communications |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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