Correlation Between SinglePoint and Sunworks

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

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

Diversification Opportunities for SinglePoint and Sunworks

-0.4

Correlation Coefficient

SinglePoint  Sunworks

Very good diversification

The 3 months correlation between SinglePoint and Sunworks is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding SinglePoint and Sunworks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunworks and SinglePoint 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 SinglePoint are associated (or correlated) with Sunworks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunworks has no effect on the direction of SinglePoint i.e., SinglePoint and Sunworks go up and down completely randomly.

Pair Corralation between SinglePoint and Sunworks

If you would invest  9.00  in SinglePoint on September 14, 2024 and sell it today you would lose (5.40) from holding SinglePoint or give up 60.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.85%
Values	Daily Returns

SinglePoint  vs.  Sunworks

SinglePoint

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SinglePoint has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly inconsistent basic indicators, SinglePoint reported solid returns over the last few months and may actually be approaching a breakup point.

Sunworks

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sunworks has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Sunworks is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with SinglePoint and Sunworks

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

The idea behind SinglePoint and Sunworks 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.