Correlation Between Princeton Capital and Alaska Power

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

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

Diversification Opportunities for Princeton Capital and Alaska Power

0.02

Correlation Coefficient

Princeton Capital  Alaska Power

Significant diversification

The 3 months correlation between Princeton and Alaska is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Princeton Capital and Alaska Power Telephone in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alaska Power Telephone and Princeton Capital 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 Princeton Capital are associated (or correlated) with Alaska Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alaska Power Telephone has no effect on the direction of Princeton Capital i.e., Princeton Capital and Alaska Power go up and down completely randomly.

Pair Corralation between Princeton Capital and Alaska Power

Given the investment horizon of 90 days Princeton Capital is expected to generate 4.06 times more return on investment than Alaska Power. However, Princeton Capital is 4.06 times more volatile than Alaska Power Telephone. It trades about 0.07 of its potential returns per unit of risk. Alaska Power Telephone is currently generating about -0.02 per unit of risk. If you would invest  5.20  in Princeton Capital on July 3, 2025 and sell it today you would earn a total of  0.70  from holding Princeton Capital or generate 13.46% return on investment over 90 days.

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

Princeton Capital  vs.  Alaska Power Telephone

Princeton Capital

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Princeton Capital are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Princeton Capital exhibited solid returns over the last few months and may actually be approaching a breakup point.

Alaska Power Telephone

Risk-Adjusted Performance

Weakest

Over the last 90 days Alaska Power Telephone has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Alaska Power is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Princeton Capital and Alaska Power

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

The idea behind Princeton Capital and Alaska Power Telephone 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.