Correlation Between Via Renewables and Knife River

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

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

Diversification Opportunities for Via Renewables and Knife River

-0.75

Correlation Coefficient

Via Renewables  Knife River

Pay attention - limited upside

The 3 months correlation between Via and Knife is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Via Renewables and Knife River in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knife River and Via Renewables 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 Via Renewables are associated (or correlated) with Knife River. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knife River has no effect on the direction of Via Renewables i.e., Via Renewables and Knife River go up and down completely randomly.

Pair Corralation between Via Renewables and Knife River

Assuming the 90 days horizon Via Renewables is expected to generate 0.18 times more return on investment than Knife River. However, Via Renewables is 5.46 times less risky than Knife River. It trades about 0.29 of its potential returns per unit of risk. Knife River is currently generating about -0.09 per unit of risk. If you would invest  2,350  in Via Renewables on May 5, 2025 and sell it today you would earn a total of  192.00  from holding Via Renewables or generate 8.17% return on investment over 90 days.

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

Via Renewables  vs.  Knife River

Via Renewables

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Via Renewables are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Via Renewables may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Knife River

Risk-Adjusted Performance

Very Weak

Over the last 90 days Knife River has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Via Renewables and Knife River

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

The idea behind Via Renewables and Knife River 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.