Correlation Between SolarEdge Technologies and JinkoSolar Holding
Can any of the company-specific risk be diversified away by investing in both SolarEdge Technologies and JinkoSolar Holding 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 SolarEdge Technologies and JinkoSolar Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SolarEdge Technologies and JinkoSolar Holding Co, you can compare the effects of market volatilities on SolarEdge Technologies and JinkoSolar Holding 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 SolarEdge Technologies with a short position of JinkoSolar Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of SolarEdge Technologies and JinkoSolar Holding.
Diversification Opportunities for SolarEdge Technologies and JinkoSolar Holding
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between SolarEdge and JinkoSolar is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding SolarEdge Technologies and JinkoSolar Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JinkoSolar Holding and SolarEdge Technologies 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 SolarEdge Technologies are associated (or correlated) with JinkoSolar Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JinkoSolar Holding has no effect on the direction of SolarEdge Technologies i.e., SolarEdge Technologies and JinkoSolar Holding go up and down completely randomly.
Pair Corralation between SolarEdge Technologies and JinkoSolar Holding
Assuming the 90 days horizon SolarEdge Technologies is expected to generate 2.09 times more return on investment than JinkoSolar Holding. However, SolarEdge Technologies is 2.09 times more volatile than JinkoSolar Holding Co. It trades about 0.01 of its potential returns per unit of risk. JinkoSolar Holding Co is currently generating about -0.19 per unit of risk. If you would invest 1,600 in SolarEdge Technologies on September 2, 2024 and sell it today you would lose (77.00) from holding SolarEdge Technologies or give up 4.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SolarEdge Technologies vs. JinkoSolar Holding Co
Performance |
| Timeline |
| SolarEdge Technologies |
| JinkoSolar Holding |
SolarEdge Technologies and JinkoSolar Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SolarEdge Technologies and JinkoSolar Holding
The main advantage of trading using opposite SolarEdge Technologies and JinkoSolar Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SolarEdge Technologies position performs unexpectedly, JinkoSolar Holding 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 JinkoSolar Holding will offset losses from the drop in JinkoSolar Holding's long position.| SolarEdge Technologies vs. Xinyi Solar Holdings | SolarEdge Technologies vs. Superior Plus Corp | SolarEdge Technologies vs. NMI Holdings | SolarEdge Technologies vs. Origin Agritech |
| JinkoSolar Holding vs. Ming Le Sports | JinkoSolar Holding vs. Playa Hotels Resorts | JinkoSolar Holding vs. Perseus Mining Limited | JinkoSolar Holding vs. PLAYTECH |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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