Correlation Between Tesla and Baker Hughes

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Tesla and Baker Hughes 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 Tesla and Baker Hughes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tesla Inc and Baker Hughes A, you can compare the effects of market volatilities on Tesla and Baker Hughes 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 Tesla with a short position of Baker Hughes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tesla and Baker Hughes.

Diversification Opportunities for Tesla and Baker Hughes

-0.47
  Correlation Coefficient

Very good diversification

The 3 months correlation between Tesla and Baker is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Tesla Inc and Baker Hughes A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baker Hughes A and Tesla 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 Tesla Inc are associated (or correlated) with Baker Hughes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baker Hughes A has no effect on the direction of Tesla i.e., Tesla and Baker Hughes go up and down completely randomly.

Pair Corralation between Tesla and Baker Hughes

Given the investment horizon of 90 days Tesla Inc is expected to generate 1.39 times more return on investment than Baker Hughes. However, Tesla is 1.39 times more volatile than Baker Hughes A. It trades about 0.04 of its potential returns per unit of risk. Baker Hughes A is currently generating about 0.06 per unit of risk. If you would invest  15,377  in Tesla Inc on July 6, 2022 and sell it today you would earn a total of  8,863  from holding Tesla Inc or generate 57.64% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Tesla Inc  vs.  Baker Hughes A

 Performance (%) 
       Timeline  
Tesla Inc 
Tesla Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Tesla Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting essential indicators, Tesla may actually be approaching a critical reversion point that can send shares even higher in November 2022.

Tesla Price Channel

Baker Hughes A 
Baker Performance
0 of 100
Over the last 90 days Baker Hughes A has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in November 2022. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Baker Price Channel

Tesla and Baker Hughes Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Tesla and Baker Hughes

The main advantage of trading using opposite Tesla and Baker Hughes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tesla position performs unexpectedly, Baker Hughes 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 Baker Hughes will offset losses from the drop in Baker Hughes' long position.
Tesla vs. Amazon Inc
The idea behind Tesla Inc and Baker Hughes A 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.
Baker Hughes vs. Amazon Inc
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

Other Complementary Tools

Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated
Go
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Go
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Go
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Go
Global Correlations
Find global opportunities by holding instruments from different markets
Go
Global Correlations
Find global opportunities by holding instruments from different markets
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Go
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Go
ETF Directory
Find actively traded Exchange Traded Funds (ETF) from around the world
Go
Stock Tickers
Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites
Go