Correlation Between Boralex and Inventronics

Can any of the company-specific risk be diversified away by investing in both Boralex and Inventronics 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 Boralex and Inventronics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Boralex and Inventronics, you can compare the effects of market volatilities on Boralex and Inventronics 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 Boralex with a short position of Inventronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boralex and Inventronics.

Diversification Opportunities for Boralex and Inventronics

0.67

Correlation Coefficient

Boralex  Inventronics

Poor diversification

The 3 months correlation between Boralex and Inventronics is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Boralex and Inventronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inventronics and Boralex 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 Boralex are associated (or correlated) with Inventronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inventronics has no effect on the direction of Boralex i.e., Boralex and Inventronics go up and down completely randomly.

Pair Corralation between Boralex and Inventronics

Assuming the 90 days trading horizon Boralex is expected to generate 5.24 times less return on investment than Inventronics. But when comparing it to its historical volatility, Boralex is 6.64 times less risky than Inventronics. It trades about 0.08 of its potential returns per unit of risk. Inventronics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  59.00  in Inventronics on April 24, 2025 and sell it today you would earn a total of  11.00  from holding Inventronics or generate 18.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Boralex  vs.  Inventronics

Boralex

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Boralex are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Boralex may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Inventronics

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Inventronics are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Inventronics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Boralex and Inventronics

The main advantage of trading using opposite Boralex and Inventronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boralex position performs unexpectedly, Inventronics 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 Inventronics will offset losses from the drop in Inventronics' long position.

The idea behind Boralex and Inventronics 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.

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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.