Correlation Between Array Technologies and First Solar
Can any of the company-specific risk be diversified away by investing in both Array Technologies and First Solar 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 Array Technologies and First Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Array Technologies and First Solar, you can compare the effects of market volatilities on Array Technologies and First Solar 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 Array Technologies with a short position of First Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Array Technologies and First Solar.
Diversification Opportunities for Array Technologies and First Solar
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Array and First is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Array Technologies and First Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Solar and Array 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 Array Technologies are associated (or correlated) with First Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Solar has no effect on the direction of Array Technologies i.e., Array Technologies and First Solar go up and down completely randomly.
Pair Corralation between Array Technologies and First Solar
Given the investment horizon of 90 days Array Technologies is expected to under-perform the First Solar. In addition to that, Array Technologies is 1.44 times more volatile than First Solar. It trades about -0.05 of its total potential returns per unit of risk. First Solar is currently generating about 0.02 per unit of volatility. If you would invest 19,233 in First Solar on August 31, 2024 and sell it today you would earn a total of 694.00 from holding First Solar or generate 3.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Array Technologies vs. First Solar
Performance |
| Timeline |
| Array Technologies |
| First Solar |
Array Technologies and First Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Array Technologies and First Solar
The main advantage of trading using opposite Array Technologies and First Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Array Technologies position performs unexpectedly, First Solar 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 First Solar will offset losses from the drop in First Solar's long position.| Array Technologies vs. SolarEdge Technologies | Array Technologies vs. Enphase Energy | Array Technologies vs. Canadian Solar | Array Technologies vs. Sunrun Inc |
| First Solar vs. Enphase Energy | First Solar vs. Sunrun Inc | First Solar vs. Canadian Solar | First Solar vs. SolarEdge Technologies |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Transaction History View history of all your transactions and understand their impact on performance |