Correlation Between Energy Of and AES
Can any of the company-specific risk be diversified away by investing in both Energy Of and AES 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 Energy Of and AES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energy of Minas and The AES, you can compare the effects of market volatilities on Energy Of and AES 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 Energy Of with a short position of AES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energy Of and AES.
Diversification Opportunities for Energy Of and AES
Very good diversification
The 3 months correlation between Energy and AES is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Energy of Minas and The AES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AES and Energy Of 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 Energy of Minas are associated (or correlated) with AES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AES has no effect on the direction of Energy Of i.e., Energy Of and AES go up and down completely randomly.
Pair Corralation between Energy Of and AES
Assuming the 90 days horizon Energy Of is expected to generate 166.43 times less return on investment than AES. But when comparing it to its historical volatility, Energy of Minas is 1.46 times less risky than AES. It trades about 0.0 of its potential returns per unit of risk. The AES is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,324 in The AES on August 31, 2025 and sell it today you would earn a total of 67.00 from holding The AES or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Energy of Minas vs. The AES
Performance |
| Timeline |
| Energy of Minas |
| AES |
Energy Of and AES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energy Of and AES
The main advantage of trading using opposite Energy Of and AES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energy Of position performs unexpectedly, AES 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 AES will offset losses from the drop in AES's long position.| Energy Of vs. Centaur Media Plc | Energy Of vs. XLMedia PLC | Energy Of vs. nDatalyze Corp | Energy Of vs. Datalex plc |
| AES vs. GCT Semiconductor Holding | AES vs. Suntory Beverage Food | AES vs. Lattice Semiconductor | AES vs. Fernhill Beverage |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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