Correlation Between ABCO Energy and Sunworks
Can any of the company-specific risk be diversified away by investing in both ABCO Energy and Sunworks 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 ABCO Energy and Sunworks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABCO Energy and Sunworks, you can compare the effects of market volatilities on ABCO Energy and Sunworks 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 ABCO Energy with a short position of Sunworks. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABCO Energy and Sunworks.
Diversification Opportunities for ABCO Energy and Sunworks
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ABCO and Sunworks is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ABCO Energy and Sunworks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunworks and ABCO 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 ABCO Energy are associated (or correlated) with Sunworks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunworks has no effect on the direction of ABCO Energy i.e., ABCO Energy and Sunworks go up and down completely randomly.
Pair Corralation between ABCO Energy and Sunworks
Given the investment horizon of 90 days ABCO Energy is expected to generate 1.54 times less return on investment than Sunworks. In addition to that, ABCO Energy is 2.33 times more volatile than Sunworks. It trades about 0.03 of its total potential returns per unit of risk. Sunworks is currently generating about 0.11 per unit of volatility. If you would invest 135.00 in Sunworks on September 1, 2024 and sell it today you would earn a total of 27.00 from holding Sunworks or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 8.33% |
| Values | Daily Returns |
ABCO Energy vs. Sunworks
Performance |
| Timeline |
| ABCO Energy |
| Sunworks |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ABCO Energy and Sunworks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABCO Energy and Sunworks
The main advantage of trading using opposite ABCO Energy and Sunworks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABCO Energy position performs unexpectedly, Sunworks 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 Sunworks will offset losses from the drop in Sunworks' long position.| ABCO Energy vs. SinglePoint | ABCO Energy vs. VivoPower International PLC | ABCO Energy vs. SPI Energy Co | ABCO Energy vs. Solar Integrated Roofing |
| Sunworks vs. Sunrun Inc | Sunworks vs. Maxeon Solar Technologies | Sunworks vs. Canadian Solar | Sunworks vs. First Solar |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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