Correlation Between Enphase Energy and Three Sixty
Can any of the company-specific risk be diversified away by investing in both Enphase Energy and Three Sixty 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 Enphase Energy and Three Sixty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enphase Energy and Three Sixty Solar, you can compare the effects of market volatilities on Enphase Energy and Three Sixty 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 Enphase Energy with a short position of Three Sixty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enphase Energy and Three Sixty.
Diversification Opportunities for Enphase Energy and Three Sixty
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Enphase and Three is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Enphase Energy and Three Sixty Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Three Sixty Solar and Enphase 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 Enphase Energy are associated (or correlated) with Three Sixty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Three Sixty Solar has no effect on the direction of Enphase Energy i.e., Enphase Energy and Three Sixty go up and down completely randomly.
Pair Corralation between Enphase Energy and Three Sixty
Given the investment horizon of 90 days Enphase Energy is expected to generate 0.15 times more return on investment than Three Sixty. However, Enphase Energy is 6.54 times less risky than Three Sixty. It trades about -0.16 of its potential returns per unit of risk. Three Sixty Solar is currently generating about -0.24 per unit of risk. If you would invest 7,847 in Enphase Energy on August 24, 2024 and sell it today you would lose (1,490) from holding Enphase Energy or give up 18.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Enphase Energy vs. Three Sixty Solar
Performance |
| Timeline |
| Enphase Energy |
| Three Sixty Solar |
Enphase Energy and Three Sixty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enphase Energy and Three Sixty
The main advantage of trading using opposite Enphase Energy and Three Sixty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enphase Energy position performs unexpectedly, Three Sixty 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 Three Sixty will offset losses from the drop in Three Sixty's long position.| Enphase Energy vs. First Solar | Enphase Energy vs. Sunrun Inc | Enphase Energy vs. Canadian Solar | Enphase Energy vs. SolarEdge Technologies |
| Three Sixty vs. SMA Solar Technology | Three Sixty vs. Xinyi Solar Holdings | Three Sixty vs. SMA Solar Technology | Three Sixty vs. GCL Poly Energy Holdings |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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