Correlation Between JinkoSolar Holding and FTC Solar
Can any of the company-specific risk be diversified away by investing in both JinkoSolar Holding and FTC 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 JinkoSolar Holding and FTC Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JinkoSolar Holding and FTC Solar, you can compare the effects of market volatilities on JinkoSolar Holding and FTC 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 JinkoSolar Holding with a short position of FTC Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of JinkoSolar Holding and FTC Solar.
Diversification Opportunities for JinkoSolar Holding and FTC Solar
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JinkoSolar and FTC is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding JinkoSolar Holding and FTC Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTC Solar and JinkoSolar Holding 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 JinkoSolar Holding are associated (or correlated) with FTC Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FTC Solar has no effect on the direction of JinkoSolar Holding i.e., JinkoSolar Holding and FTC Solar go up and down completely randomly.
Pair Corralation between JinkoSolar Holding and FTC Solar
Considering the 90-day investment horizon JinkoSolar Holding is expected to generate 1.29 times more return on investment than FTC Solar. However, JinkoSolar Holding is 1.29 times more volatile than FTC Solar. It trades about 0.04 of its potential returns per unit of risk. FTC Solar is currently generating about -0.33 per unit of risk. If you would invest 2,134 in JinkoSolar Holding on August 23, 2024 and sell it today you would earn a total of 33.00 from holding JinkoSolar Holding or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JinkoSolar Holding vs. FTC Solar
Performance |
| Timeline |
| JinkoSolar Holding |
| FTC Solar |
JinkoSolar Holding and FTC Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JinkoSolar Holding and FTC Solar
The main advantage of trading using opposite JinkoSolar Holding and FTC Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JinkoSolar Holding position performs unexpectedly, FTC 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 FTC Solar will offset losses from the drop in FTC Solar's long position.| JinkoSolar Holding vs. Small Cap Core | JinkoSolar Holding vs. Freedom Holding Corp | JinkoSolar Holding vs. Gfl Environmental Holdings | JinkoSolar Holding vs. Growth Fund Of |
| FTC Solar vs. Small Cap Core | FTC Solar vs. Freedom Holding Corp | FTC Solar vs. Gfl Environmental Holdings | FTC Solar vs. Growth Fund Of |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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