Correlation Between First Solar and Solar Integrated
Can any of the company-specific risk be diversified away by investing in both First Solar and Solar Integrated 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 First Solar and Solar Integrated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Solar and Solar Integrated Roofing, you can compare the effects of market volatilities on First Solar and Solar Integrated 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 First Solar with a short position of Solar Integrated. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Solar and Solar Integrated.
Diversification Opportunities for First Solar and Solar Integrated
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between First and Solar is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding First Solar and Solar Integrated Roofing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solar Integrated Roofing and First 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 First Solar are associated (or correlated) with Solar Integrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solar Integrated Roofing has no effect on the direction of First Solar i.e., First Solar and Solar Integrated go up and down completely randomly.
Pair Corralation between First Solar and Solar Integrated
If you would invest 0.01 in Solar Integrated Roofing on December 5, 2024 and sell it today you would earn a total of 0.00 from holding Solar Integrated Roofing or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
First Solar vs. Solar Integrated Roofing
Performance |
Timeline |
First Solar |
Solar Integrated Roofing |
First Solar and Solar Integrated Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with First Solar and Solar Integrated
The main advantage of trading using opposite First Solar and Solar Integrated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Solar position performs unexpectedly, Solar Integrated 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 Solar Integrated will offset losses from the drop in Solar Integrated's long position.First Solar vs. Enphase Energy | First Solar vs. Sunrun Inc | First Solar vs. Canadian Solar | First Solar vs. SolarEdge Technologies |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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