Correlation Between Solution Advanced and S-Fuelcell
Can any of the company-specific risk be diversified away by investing in both Solution Advanced and S-Fuelcell 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 Solution Advanced and S-Fuelcell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solution Advanced Technology and S Fuelcell co, you can compare the effects of market volatilities on Solution Advanced and S-Fuelcell 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 Solution Advanced with a short position of S-Fuelcell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solution Advanced and S-Fuelcell.
Diversification Opportunities for Solution Advanced and S-Fuelcell
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Solution and S-Fuelcell is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Solution Advanced Technology and S Fuelcell co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S Fuelcell co and Solution Advanced 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 Solution Advanced Technology are associated (or correlated) with S-Fuelcell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S Fuelcell co has no effect on the direction of Solution Advanced i.e., Solution Advanced and S-Fuelcell go up and down completely randomly.
Pair Corralation between Solution Advanced and S-Fuelcell
Assuming the 90 days trading horizon Solution Advanced Technology is expected to under-perform the S-Fuelcell. In addition to that, Solution Advanced is 1.09 times more volatile than S Fuelcell co. It trades about -0.08 of its total potential returns per unit of risk. S Fuelcell co is currently generating about -0.07 per unit of volatility. If you would invest 1,488,395 in S Fuelcell co on September 14, 2024 and sell it today you would lose (636,395) from holding S Fuelcell co or give up 42.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solution Advanced Technology vs. S Fuelcell co
Performance |
| Timeline |
| Solution Advanced |
| S Fuelcell co |
Solution Advanced and S-Fuelcell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solution Advanced and S-Fuelcell
The main advantage of trading using opposite Solution Advanced and S-Fuelcell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solution Advanced position performs unexpectedly, S-Fuelcell 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 S-Fuelcell will offset losses from the drop in S-Fuelcell's long position.| Solution Advanced vs. Samsung Electronics Co | Solution Advanced vs. Samsung Electronics Co | Solution Advanced vs. LG Energy Solution | Solution Advanced vs. SK Hynix |
| S-Fuelcell vs. Ecopro BM Co | S-Fuelcell vs. Sangsin Energy Display | S-Fuelcell vs. Solution Advanced Technology | S-Fuelcell vs. Busan Industrial Co |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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