Correlation Between Solid Power and Allient
Can any of the company-specific risk be diversified away by investing in both Solid Power and Allient 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 Solid Power and Allient into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solid Power and Allient, you can compare the effects of market volatilities on Solid Power and Allient 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 Solid Power with a short position of Allient. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solid Power and Allient.
Diversification Opportunities for Solid Power and Allient
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Solid and Allient is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Solid Power and Allient in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allient and Solid Power 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 Solid Power are associated (or correlated) with Allient. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allient has no effect on the direction of Solid Power i.e., Solid Power and Allient go up and down completely randomly.
Pair Corralation between Solid Power and Allient
Given the investment horizon of 90 days Solid Power is expected to generate 1.71 times more return on investment than Allient. However, Solid Power is 1.71 times more volatile than Allient. It trades about 0.04 of its potential returns per unit of risk. Allient is currently generating about 0.02 per unit of risk. If you would invest 286.00 in Solid Power on April 20, 2025 and sell it today you would earn a total of 91.00 from holding Solid Power or generate 31.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solid Power vs. Allient
Performance |
| Timeline |
| Solid Power |
| Allient |
Solid Power and Allient Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solid Power and Allient
The main advantage of trading using opposite Solid Power and Allient positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solid Power position performs unexpectedly, Allient 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 Allient will offset losses from the drop in Allient's long position.| Solid Power vs. Microvast Holdings | Solid Power vs. Bloom Energy Corp | Solid Power vs. Enovix Corp | Solid Power vs. Plug Power |
| Allient vs. Grupo Televisa SAB | Allient vs. TechTarget, Common Stock | Allient vs. BCE Inc | Allient vs. Gevo Inc |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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