Correlation Between Ameresco and Workhorse

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

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

Diversification Opportunities for Ameresco and Workhorse

0.65

Correlation Coefficient

Ameresco  Workhorse

Poor diversification

The 3 months correlation between Ameresco and Workhorse is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Ameresco and Workhorse Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Workhorse Group and Ameresco 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 Ameresco are associated (or correlated) with Workhorse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Workhorse Group has no effect on the direction of Ameresco i.e., Ameresco and Workhorse go up and down completely randomly.

Pair Corralation between Ameresco and Workhorse

Given the investment horizon of 90 days Ameresco is expected to generate 2.34 times less return on investment than Workhorse. But when comparing it to its historical volatility, Ameresco is 3.1 times less risky than Workhorse. It trades about 0.14 of its potential returns per unit of risk. Workhorse Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  110.00  in Workhorse Group on May 4, 2025 and sell it today you would earn a total of  55.00  from holding Workhorse Group or generate 50.0% return on investment over 90 days.

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

Ameresco  vs.  Workhorse Group

Ameresco

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ameresco are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Ameresco exhibited solid returns over the last few months and may actually be approaching a breakup point.

Workhorse Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Workhorse Group are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting technical indicators, Workhorse unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ameresco and Workhorse

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

The idea behind Ameresco and Workhorse Group 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.