Correlation Between SunHydrogen and TGI Solar
Can any of the company-specific risk be diversified away by investing in both SunHydrogen and TGI 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 SunHydrogen and TGI Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunHydrogen and TGI Solar Power, you can compare the effects of market volatilities on SunHydrogen and TGI 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 SunHydrogen with a short position of TGI Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunHydrogen and TGI Solar.
Diversification Opportunities for SunHydrogen and TGI Solar
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SunHydrogen and TGI is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding SunHydrogen and TGI Solar Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TGI Solar Power and SunHydrogen 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 SunHydrogen are associated (or correlated) with TGI Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TGI Solar Power has no effect on the direction of SunHydrogen i.e., SunHydrogen and TGI Solar go up and down completely randomly.
Pair Corralation between SunHydrogen and TGI Solar
Given the investment horizon of 90 days SunHydrogen is expected to under-perform the TGI Solar. But the pink sheet apears to be less risky and, when comparing its historical volatility, SunHydrogen is 2.31 times less risky than TGI Solar. The pink sheet trades about -0.52 of its potential returns per unit of risk. The TGI Solar Power is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 0.14 in TGI Solar Power on December 10, 2024 and sell it today you would earn a total of 0.02 from holding TGI Solar Power or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunHydrogen vs. TGI Solar Power
Performance |
| Timeline |
| SunHydrogen |
| TGI Solar Power |
SunHydrogen and TGI Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunHydrogen and TGI Solar
The main advantage of trading using opposite SunHydrogen and TGI Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunHydrogen position performs unexpectedly, TGI 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 TGI Solar will offset losses from the drop in TGI Solar's long position.| SunHydrogen vs. Enerkon Solar International | ||
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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