Correlation Between Carnegie Clean and UTD OV

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

By analyzing existing cross correlation between Carnegie Clean Energy and UTD OV BK LOC ADR1, you can compare the effects of market volatilities on Carnegie Clean and UTD OV 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 Carnegie Clean with a short position of UTD OV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carnegie Clean and UTD OV.

Diversification Opportunities for Carnegie Clean and UTD OV

0.25

Correlation Coefficient

Carnegie Clean  UTD OV

Modest diversification

The 3 months correlation between Carnegie and UTD is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Carnegie Clean Energy and UTD OV BK LOC ADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UTD OV BK and Carnegie Clean 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 Carnegie Clean Energy are associated (or correlated) with UTD OV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UTD OV BK has no effect on the direction of Carnegie Clean i.e., Carnegie Clean and UTD OV go up and down completely randomly.

Pair Corralation between Carnegie Clean and UTD OV

Assuming the 90 days trading horizon Carnegie Clean Energy is expected to generate 4.2 times more return on investment than UTD OV. However, Carnegie Clean is 4.2 times more volatile than UTD OV BK LOC ADR1. It trades about 0.13 of its potential returns per unit of risk. UTD OV BK LOC ADR1 is currently generating about 0.08 per unit of risk. If you would invest  1.90  in Carnegie Clean Energy on April 25, 2025 and sell it today you would earn a total of  0.72  from holding Carnegie Clean Energy or generate 37.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Carnegie Clean Energy  vs.  UTD OV BK LOC ADR1

Carnegie Clean Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Carnegie Clean Energy are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, Carnegie Clean reported solid returns over the last few months and may actually be approaching a breakup point.

UTD OV BK

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in UTD OV BK LOC ADR1 are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable fundamental drivers, UTD OV is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Carnegie Clean and UTD OV

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

The idea behind Carnegie Clean Energy and UTD OV BK LOC ADR1 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.