Correlation Between Maxeon Solar and Digilife Technologies
Can any of the company-specific risk be diversified away by investing in both Maxeon Solar and Digilife Technologies 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 Maxeon Solar and Digilife Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maxeon Solar Technologies and Digilife Technologies Limited, you can compare the effects of market volatilities on Maxeon Solar and Digilife Technologies 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 Maxeon Solar with a short position of Digilife Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxeon Solar and Digilife Technologies.
Diversification Opportunities for Maxeon Solar and Digilife Technologies
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Maxeon and Digilife is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Maxeon Solar Technologies and Digilife Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digilife Technologies and Maxeon Solar 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 Maxeon Solar Technologies are associated (or correlated) with Digilife Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digilife Technologies has no effect on the direction of Maxeon Solar i.e., Maxeon Solar and Digilife Technologies go up and down completely randomly.
Pair Corralation between Maxeon Solar and Digilife Technologies
Assuming the 90 days horizon Maxeon Solar Technologies is expected to generate 3.26 times more return on investment than Digilife Technologies. However, Maxeon Solar is 3.26 times more volatile than Digilife Technologies Limited. It trades about 0.02 of its potential returns per unit of risk. Digilife Technologies Limited is currently generating about 0.0 per unit of risk. If you would invest 880.00 in Maxeon Solar Technologies on September 18, 2024 and sell it today you would lose (190.00) from holding Maxeon Solar Technologies or give up 21.59% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 92.19% |
Values | Daily Returns |
Maxeon Solar Technologies vs. Digilife Technologies Limited
Performance |
Timeline |
Maxeon Solar Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Digilife Technologies |
Maxeon Solar and Digilife Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Maxeon Solar and Digilife Technologies
The main advantage of trading using opposite Maxeon Solar and Digilife Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxeon Solar position performs unexpectedly, Digilife Technologies 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 Digilife Technologies will offset losses from the drop in Digilife Technologies' long position.Maxeon Solar vs. Axcelis Technologies | Maxeon Solar vs. Uber Technologies | Maxeon Solar vs. AAC TECHNOLOGHLDGADR | Maxeon Solar vs. Ribbon Communications |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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