Correlation Between Fermi Common and IDACORP
Can any of the company-specific risk be diversified away by investing in both Fermi Common and IDACORP 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 Fermi Common and IDACORP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fermi Common Stock and IDACORP, you can compare the effects of market volatilities on Fermi Common and IDACORP 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 Fermi Common with a short position of IDACORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fermi Common and IDACORP.
Diversification Opportunities for Fermi Common and IDACORP
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fermi and IDACORP is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Fermi Common Stock and IDACORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IDACORP and Fermi Common 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 Fermi Common Stock are associated (or correlated) with IDACORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IDACORP has no effect on the direction of Fermi Common i.e., Fermi Common and IDACORP go up and down completely randomly.
Pair Corralation between Fermi Common and IDACORP
Given the investment horizon of 90 days Fermi Common Stock is expected to under-perform the IDACORP. In addition to that, Fermi Common is 9.96 times more volatile than IDACORP. It trades about -0.14 of its total potential returns per unit of risk. IDACORP is currently generating about -0.06 per unit of volatility. If you would invest 13,363 in IDACORP on October 9, 2025 and sell it today you would lose (451.00) from holding IDACORP or give up 3.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fermi Common Stock vs. IDACORP
Performance |
| Timeline |
| Fermi Common Stock |
| IDACORP |
Fermi Common and IDACORP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fermi Common and IDACORP
The main advantage of trading using opposite Fermi Common and IDACORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fermi Common position performs unexpectedly, IDACORP 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 IDACORP will offset losses from the drop in IDACORP's long position.| Fermi Common vs. Alliant Energy Corp | Fermi Common vs. Evergy | Fermi Common vs. Sempra Energy | Fermi Common vs. Emera Incorporated |
| IDACORP vs. Portland General Electric | IDACORP vs. TXNM Energy | IDACORP vs. MGE Energy | IDACORP vs. CMS Energy |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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