Correlation Between SPI Energy and ON Semiconductor
Can any of the company-specific risk be diversified away by investing in both SPI Energy and ON Semiconductor 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 SPI Energy and ON Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPI Energy Co and ON Semiconductor, you can compare the effects of market volatilities on SPI Energy and ON Semiconductor 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 SPI Energy with a short position of ON Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPI Energy and ON Semiconductor.
Diversification Opportunities for SPI Energy and ON Semiconductor
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPI and ON Semiconductor is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding SPI Energy Co and ON Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ON Semiconductor and SPI Energy 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 SPI Energy Co are associated (or correlated) with ON Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ON Semiconductor has no effect on the direction of SPI Energy i.e., SPI Energy and ON Semiconductor go up and down completely randomly.
Pair Corralation between SPI Energy and ON Semiconductor
Considering the 90-day investment horizon SPI Energy Co is expected to generate 5.25 times more return on investment than ON Semiconductor. However, SPI Energy is 5.25 times more volatile than ON Semiconductor. It trades about 0.06 of its potential returns per unit of risk. ON Semiconductor is currently generating about -0.16 per unit of risk. If you would invest 39.00 in SPI Energy Co on October 31, 2024 and sell it today you would lose (3.00) from holding SPI Energy Co or give up 7.69% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 88.14% |
Values | Daily Returns |
SPI Energy Co vs. ON Semiconductor
Performance |
Timeline |
SPI Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
ON Semiconductor |
SPI Energy and ON Semiconductor Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SPI Energy and ON Semiconductor
The main advantage of trading using opposite SPI Energy and ON Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPI Energy position performs unexpectedly, ON Semiconductor 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 ON Semiconductor will offset losses from the drop in ON Semiconductor's long position.SPI Energy vs. Ascent Solar Technologies, | ||
SPI Energy vs. Emeren Group | ||
SPI Energy vs. Sunrun Inc | ||
SPI Energy vs. Sunnova Energy International |
ON Semiconductor vs. Texas Instruments Incorporated | ||
ON Semiconductor vs. Microchip Technology | ||
ON Semiconductor vs. Analog Devices | ||
ON Semiconductor vs. Qorvo Inc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |