Correlation Between Scatec Solar and Cloudberry Clean

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

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

Diversification Opportunities for Scatec Solar and Cloudberry Clean

0.55

Correlation Coefficient

Scatec Solar  Cloudberry Clean

Very weak diversification

The 3 months correlation between Scatec and Cloudberry is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Scatec Solar OL and Cloudberry Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cloudberry Clean Energy and Scatec Solar 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 Scatec Solar OL are associated (or correlated) with Cloudberry Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cloudberry Clean Energy has no effect on the direction of Scatec Solar i.e., Scatec Solar and Cloudberry Clean go up and down completely randomly.

Pair Corralation between Scatec Solar and Cloudberry Clean

Assuming the 90 days trading horizon Scatec Solar OL is expected to generate 0.74 times more return on investment than Cloudberry Clean. However, Scatec Solar OL is 1.36 times less risky than Cloudberry Clean. It trades about 0.36 of its potential returns per unit of risk. Cloudberry Clean Energy is currently generating about 0.09 per unit of risk. If you would invest  7,890  in Scatec Solar OL on April 25, 2025 and sell it today you would earn a total of  2,570  from holding Scatec Solar OL or generate 32.57% return on investment over 90 days.

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

Scatec Solar OL  vs.  Cloudberry Clean Energy

Scatec Solar OL

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Scatec Solar OL are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Scatec Solar displayed solid returns over the last few months and may actually be approaching a breakup point.

Cloudberry Clean Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cloudberry Clean Energy are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Cloudberry Clean may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Scatec Solar and Cloudberry Clean

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

The idea behind Scatec Solar OL and Cloudberry Clean Energy 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.