Correlation Between Brenmiller Energy and Badger DAO

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Can any of the company-specific risk be diversified away by investing in both Brenmiller Energy and Badger DAO 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 Brenmiller Energy and Badger DAO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brenmiller Energy and Badger DAO, you can compare the effects of market volatilities on Brenmiller Energy and Badger DAO 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 Brenmiller Energy with a short position of Badger DAO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brenmiller Energy and Badger DAO.

Diversification Opportunities for Brenmiller Energy and Badger DAO

0.22
  Correlation Coefficient

Modest diversification

The 3 months correlation between Brenmiller and Badger is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Brenmiller Energy and Badger DAO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Badger DAO and Brenmiller 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 Brenmiller Energy are associated (or correlated) with Badger DAO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Badger DAO has no effect on the direction of Brenmiller Energy i.e., Brenmiller Energy and Badger DAO go up and down completely randomly.

Pair Corralation between Brenmiller Energy and Badger DAO

Given the investment horizon of 90 days Brenmiller Energy is expected to generate 16.71 times more return on investment than Badger DAO. However, Brenmiller Energy is 16.71 times more volatile than Badger DAO. It trades about 0.13 of its potential returns per unit of risk. Badger DAO is currently generating about -0.06 per unit of risk. If you would invest  0.00  in Brenmiller Energy on May 17, 2022 and sell it today you would earn a total of  392.00  from holding Brenmiller Energy or generate 9.223372036854776E16% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy27.23%
ValuesDaily Returns

Brenmiller Energy  vs.  Badger DAO

 Performance (%) 
       Timeline  
Brenmiller Energy 
Brenmiller Performance
9 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Brenmiller Energy are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Brenmiller Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.

Brenmiller Price Channel

Badger DAO 
Badger Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Badger DAO are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, Badger DAO sustained solid returns over the last few months and may actually be approaching a breakup point.

Badger Price Channel

Brenmiller Energy and Badger DAO Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Brenmiller Energy and Badger DAO

The main advantage of trading using opposite Brenmiller Energy and Badger DAO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brenmiller Energy position performs unexpectedly, Badger DAO 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 Badger DAO will offset losses from the drop in Badger DAO's long position.
The idea behind Brenmiller Energy and Badger DAO 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.
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

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