Correlation Between First Solar and Entegris
Can any of the company-specific risk be diversified away by investing in both First Solar and Entegris 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 First Solar and Entegris into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Solar and Entegris, you can compare the effects of market volatilities on First Solar and Entegris 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 First Solar with a short position of Entegris. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Solar and Entegris.
Diversification Opportunities for First Solar and Entegris
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between First and Entegris is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding First Solar and Entegris in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entegris and First Solar 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 First Solar are associated (or correlated) with Entegris. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entegris has no effect on the direction of First Solar i.e., First Solar and Entegris go up and down completely randomly.
Pair Corralation between First Solar and Entegris
Given the investment horizon of 90 days First Solar is expected to under-perform the Entegris. In addition to that, First Solar is 1.1 times more volatile than Entegris. It trades about -0.12 of its total potential returns per unit of risk. Entegris is currently generating about 0.06 per unit of volatility. If you would invest 9,945 in Entegris on November 18, 2024 and sell it today you would earn a total of 767.00 from holding Entegris or generate 7.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Solar vs. Entegris
Performance |
| Timeline |
| First Solar |
| Entegris |
First Solar and Entegris Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Solar and Entegris
The main advantage of trading using opposite First Solar and Entegris positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Solar position performs unexpectedly, Entegris 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 Entegris will offset losses from the drop in Entegris' long position.| First Solar vs. Enphase Energy | First Solar vs. Sunrun Inc | First Solar vs. Canadian Solar | First Solar vs. SolarEdge Technologies |
| Entegris vs. Teradyne | Entegris vs. Ichor Holdings | Entegris vs. Amtech Systems | Entegris vs. Veeco Instruments |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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