Correlation Between First Solar and Enerkon Solar
Can any of the company-specific risk be diversified away by investing in both First Solar and Enerkon 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 First Solar and Enerkon Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Solar and Enerkon Solar International, you can compare the effects of market volatilities on First Solar and Enerkon 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 First Solar with a short position of Enerkon Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Solar and Enerkon Solar.
Diversification Opportunities for First Solar and Enerkon Solar
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Enerkon is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding First Solar and Enerkon Solar International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enerkon Solar Intern 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 Enerkon Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enerkon Solar Intern has no effect on the direction of First Solar i.e., First Solar and Enerkon Solar go up and down completely randomly.
Pair Corralation between First Solar and Enerkon Solar
Given the investment horizon of 90 days First Solar is expected to generate 49.77 times less return on investment than Enerkon Solar. But when comparing it to its historical volatility, First Solar is 11.74 times less risky than Enerkon Solar. It trades about 0.02 of its potential returns per unit of risk. Enerkon Solar International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1.72 in Enerkon Solar International on September 1, 2024 and sell it today you would lose (1.70) from holding Enerkon Solar International or give up 98.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Solar vs. Enerkon Solar International
Performance |
| Timeline |
| First Solar |
| Enerkon Solar Intern |
First Solar and Enerkon Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Solar and Enerkon Solar
The main advantage of trading using opposite First Solar and Enerkon Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Solar position performs unexpectedly, Enerkon 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 Enerkon Solar will offset losses from the drop in Enerkon Solar's long position.| First Solar vs. Enphase Energy | First Solar vs. Sunrun Inc | First Solar vs. Canadian Solar | First Solar vs. SolarEdge Technologies |
| Enerkon Solar vs. ClearVue Technologies Limited | Enerkon Solar vs. Xinyi Solar Holdings | Enerkon Solar vs. Meyer Burger Technology | Enerkon Solar vs. Go Solar USA |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |