Correlation Between Emeren and SinglePoint

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

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

Diversification Opportunities for Emeren and SinglePoint

0.12

Correlation Coefficient

Emeren  SinglePoint

Average diversification

The 3 months correlation between Emeren and SinglePoint is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Emeren Group and SinglePoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SinglePoint and Emeren 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 Emeren Group are associated (or correlated) with SinglePoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SinglePoint has no effect on the direction of Emeren i.e., Emeren and SinglePoint go up and down completely randomly.

Pair Corralation between Emeren and SinglePoint

Considering the 90-day investment horizon Emeren Group is expected to under-perform the SinglePoint. But the stock apears to be less risky and, when comparing its historical volatility, Emeren Group is 5.13 times less risky than SinglePoint. The stock trades about -0.05 of its potential returns per unit of risk. The SinglePoint is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  10.00  in SinglePoint on September 13, 2024 and sell it today you would lose (6.40) from holding SinglePoint or give up 64.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	85.94%
Values	Daily Returns

Emeren Group  vs.  SinglePoint

Emeren Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Emeren Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

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 stable basic indicators, SinglePoint is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Emeren and SinglePoint

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

The idea behind Emeren Group and SinglePoint 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.