Correlation Between FuelCell Energy and Chart Industries

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

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

Diversification Opportunities for FuelCell Energy and Chart Industries

-0.03

Correlation Coefficient

FuelCell Energy  Chart Industries

Good diversification

The 3 months correlation between FuelCell and Chart is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding FuelCell Energy and Chart Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chart Industries and FuelCell Energy 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 FuelCell Energy are associated (or correlated) with Chart Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chart Industries has no effect on the direction of FuelCell Energy i.e., FuelCell Energy and Chart Industries go up and down completely randomly.

Pair Corralation between FuelCell Energy and Chart Industries

Given the investment horizon of 90 days FuelCell Energy is expected to generate 2.2 times more return on investment than Chart Industries. However, FuelCell Energy is 2.2 times more volatile than Chart Industries. It trades about 0.07 of its potential returns per unit of risk. Chart Industries is currently generating about 0.15 per unit of risk. If you would invest  408.00  in FuelCell Energy on May 1, 2025 and sell it today you would earn a total of  81.00  from holding FuelCell Energy or generate 19.85% return on investment over 90 days.

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

FuelCell Energy  vs.  Chart Industries

FuelCell Energy

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FuelCell Energy are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain technical and fundamental indicators, FuelCell Energy disclosed solid returns over the last few months and may actually be approaching a breakup point.

Chart Industries

Risk-Adjusted Performance

Good

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

Pair Trading with FuelCell Energy and Chart Industries

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

The idea behind FuelCell Energy and Chart Industries 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..