Correlation Between Fusion Fuel and Azure Power
Can any of the company-specific risk be diversified away by investing in both Fusion Fuel and Azure Power 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 Fusion Fuel and Azure Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fusion Fuel Green and Azure Power Global, you can compare the effects of market volatilities on Fusion Fuel and Azure Power 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 Fusion Fuel with a short position of Azure Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fusion Fuel and Azure Power.
Diversification Opportunities for Fusion Fuel and Azure Power
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Fusion and Azure is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Fusion Fuel Green and Azure Power Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azure Power Global and Fusion Fuel 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 Fusion Fuel Green are associated (or correlated) with Azure Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azure Power Global has no effect on the direction of Fusion Fuel i.e., Fusion Fuel and Azure Power go up and down completely randomly.
Pair Corralation between Fusion Fuel and Azure Power
Given the investment horizon of 90 days Fusion Fuel Green is expected to under-perform the Azure Power. But the stock apears to be less risky and, when comparing its historical volatility, Fusion Fuel Green is 1.54 times less risky than Azure Power. The stock trades about 0.0 of its potential returns per unit of risk. The Azure Power Global is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 65.00 in Azure Power Global on April 24, 2025 and sell it today you would lose (25.00) from holding Azure Power Global or give up 38.46% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.39% |
Values | Daily Returns |
Fusion Fuel Green vs. Azure Power Global
Performance |
Timeline |
Fusion Fuel Green |
Azure Power Global |
Fusion Fuel and Azure Power Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fusion Fuel and Azure Power
The main advantage of trading using opposite Fusion Fuel and Azure Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fusion Fuel position performs unexpectedly, Azure Power 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 Azure Power will offset losses from the drop in Azure Power's long position.Fusion Fuel vs. Fusion Fuel Green | Fusion Fuel vs. Advent Technologies Holdings | Fusion Fuel vs. Fluence Energy | Fusion Fuel vs. Energy Vault Holdings |
Azure Power vs. Barrick Mining | Azure Power vs. Austin Gold Corp | Azure Power vs. Hafnia Limited | Azure Power vs. Maravai Lifesciences Holdings |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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