Correlation Between Solar Integrated and ISun

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

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

Diversification Opportunities for Solar Integrated and ISun

0.14

Correlation Coefficient

Solar Integrated  ISun

Average diversification

The 3 months correlation between Solar and ISun is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Solar Integrated Roofing and ISun Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ISun Inc and Solar Integrated 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 Solar Integrated Roofing are associated (or correlated) with ISun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ISun Inc has no effect on the direction of Solar Integrated i.e., Solar Integrated and ISun go up and down completely randomly.

Pair Corralation between Solar Integrated and ISun

If you would invest  0.01  in Solar Integrated Roofing on September 14, 2024 and sell it today you would earn a total of  0.01  from holding Solar Integrated Roofing or generate 100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Solar Integrated Roofing  vs.  ISun Inc

Solar Integrated Roofing

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Solar Integrated Roofing are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Solar Integrated exhibited solid returns over the last few months and may actually be approaching a breakup point.

ISun Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ISun Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, ISun is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Solar Integrated and ISun

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

The idea behind Solar Integrated Roofing and ISun Inc 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.