Correlation Between Cognizant Technology and First Solar
Can any of the company-specific risk be diversified away by investing in both Cognizant Technology 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 Cognizant Technology and First Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cognizant Technology Solutions and First Solar, you can compare the effects of market volatilities on Cognizant Technology 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 Cognizant Technology with a short position of First Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cognizant Technology and First Solar.
Diversification Opportunities for Cognizant Technology and First Solar
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cognizant and First is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cognizant Technology Solutions and First Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Solar and Cognizant Technology 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 Cognizant Technology Solutions 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 Cognizant Technology i.e., Cognizant Technology and First Solar go up and down completely randomly.
Pair Corralation between Cognizant Technology and First Solar
If you would invest 140,000 in Cognizant Technology Solutions on November 7, 2024 and sell it today you would earn a total of 0.00 from holding Cognizant Technology Solutions or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Cognizant Technology Solutions vs. First Solar
Performance |
| Timeline |
| Cognizant Technology |
| First Solar |
Cognizant Technology and First Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cognizant Technology and First Solar
The main advantage of trading using opposite Cognizant Technology and First Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cognizant Technology 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.| Cognizant Technology vs. McEwen Mining | Cognizant Technology vs. Grupo Hotelero Santa | Cognizant Technology vs. Verizon Communications | Cognizant Technology vs. Desarrolladora Homex SAB |
| First Solar vs. Applied Materials | First Solar vs. Verizon Communications | First Solar vs. CVS Health | First Solar vs. The Bank of |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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