Correlation Between ISun and First Solar
Can any of the company-specific risk be diversified away by investing in both ISun 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 ISun and First Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ISun Inc and First Solar, you can compare the effects of market volatilities on ISun 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 ISun with a short position of First Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of ISun and First Solar.
Diversification Opportunities for ISun and First Solar
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ISun and First is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding ISun Inc and First Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Solar and ISun 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 ISun Inc 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 ISun i.e., ISun and First Solar go up and down completely randomly.
Pair Corralation between ISun and First Solar
If you would invest 3.19 in ISun Inc on August 27, 2024 and sell it today you would earn a total of 0.00 from holding ISun Inc or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.76% |
| Values | Daily Returns |
ISun Inc vs. First Solar
Performance |
| Timeline |
| ISun Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| First Solar |
ISun and First Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ISun and First Solar
The main advantage of trading using opposite ISun and First Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ISun 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.| ISun vs. Polar Power | ISun vs. VivoPower International PLC | ISun vs. Pioneer Power Solutions | ISun vs. Beam Global |
| First Solar vs. Enphase Energy | First Solar vs. Sunrun Inc | First Solar vs. Canadian Solar | First Solar vs. SolarEdge Technologies |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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