Correlation Between Evaluator Moderate and Firsthand Alternative

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

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

Diversification Opportunities for Evaluator Moderate and Firsthand Alternative

0.97

Correlation Coefficient

Evaluator Moderate  Firsthand Alternative

Almost no diversification

The 3 months correlation between Evaluator and Firsthand is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Evaluator Moderate Rms and Firsthand Alternative Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firsthand Alternative and Evaluator Moderate 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 Evaluator Moderate Rms are associated (or correlated) with Firsthand Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firsthand Alternative has no effect on the direction of Evaluator Moderate i.e., Evaluator Moderate and Firsthand Alternative go up and down completely randomly.

Pair Corralation between Evaluator Moderate and Firsthand Alternative

Assuming the 90 days horizon Evaluator Moderate is expected to generate 3.66 times less return on investment than Firsthand Alternative. But when comparing it to its historical volatility, Evaluator Moderate Rms is 2.93 times less risky than Firsthand Alternative. It trades about 0.24 of its potential returns per unit of risk. Firsthand Alternative Energy is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest  810.00  in Firsthand Alternative Energy on May 8, 2025 and sell it today you would earn a total of  244.00  from holding Firsthand Alternative Energy or generate 30.12% return on investment over 90 days.

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

Evaluator Moderate Rms  vs.  Firsthand Alternative Energy

Evaluator Moderate Rms

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Evaluator Moderate Rms are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak primary indicators, Evaluator Moderate may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Firsthand Alternative

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Firsthand Alternative Energy are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Firsthand Alternative showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Evaluator Moderate and Firsthand Alternative

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

The idea behind Evaluator Moderate Rms and Firsthand Alternative 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.

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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.