Correlation Between ASE Industrial and Maxeon Solar
Can any of the company-specific risk be diversified away by investing in both ASE Industrial and Maxeon 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 ASE Industrial and Maxeon Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASE Industrial Holding and Maxeon Solar Technologies, you can compare the effects of market volatilities on ASE Industrial and Maxeon 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 ASE Industrial with a short position of Maxeon Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASE Industrial and Maxeon Solar.
Diversification Opportunities for ASE Industrial and Maxeon Solar
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ASE and Maxeon is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding ASE Industrial Holding and Maxeon Solar Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maxeon Solar Technologies and ASE Industrial 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 ASE Industrial Holding are associated (or correlated) with Maxeon Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maxeon Solar Technologies has no effect on the direction of ASE Industrial i.e., ASE Industrial and Maxeon Solar go up and down completely randomly.
Pair Corralation between ASE Industrial and Maxeon Solar
Considering the 90-day investment horizon ASE Industrial Holding is expected to generate 0.19 times more return on investment than Maxeon Solar. However, ASE Industrial Holding is 5.28 times less risky than Maxeon Solar. It trades about 0.04 of its potential returns per unit of risk. Maxeon Solar Technologies is currently generating about -0.07 per unit of risk. If you would invest 824.00 in ASE Industrial Holding on August 24, 2024 and sell it today you would earn a total of 164.00 from holding ASE Industrial Holding or generate 19.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASE Industrial Holding vs. Maxeon Solar Technologies
Performance |
| Timeline |
| ASE Industrial Holding |
| Maxeon Solar Technologies |
ASE Industrial and Maxeon Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASE Industrial and Maxeon Solar
The main advantage of trading using opposite ASE Industrial and Maxeon Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASE Industrial position performs unexpectedly, Maxeon 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 Maxeon Solar will offset losses from the drop in Maxeon Solar's long position.| ASE Industrial vs. Eshallgo Class A | ASE Industrial vs. Amtech Systems | ASE Industrial vs. Gold Fields Ltd | ASE Industrial vs. Aegean Airlines SA |
| Maxeon Solar vs. Sunrun Inc | Maxeon Solar vs. Canadian Solar | Maxeon Solar vs. First Solar | Maxeon Solar vs. Sunnova Energy International |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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