Correlation Between Maxeon Solar and Sunnova Energy
Can any of the company-specific risk be diversified away by investing in both Maxeon Solar and Sunnova Energy 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 Maxeon Solar and Sunnova Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maxeon Solar Technologies and Sunnova Energy International, you can compare the effects of market volatilities on Maxeon Solar and Sunnova Energy 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 Maxeon Solar with a short position of Sunnova Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maxeon Solar and Sunnova Energy.
Diversification Opportunities for Maxeon Solar and Sunnova Energy
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Maxeon and Sunnova is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Maxeon Solar Technologies and Sunnova Energy International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunnova Energy Inter and Maxeon 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 Maxeon Solar Technologies are associated (or correlated) with Sunnova Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunnova Energy Inter has no effect on the direction of Maxeon Solar i.e., Maxeon Solar and Sunnova Energy go up and down completely randomly.
Pair Corralation between Maxeon Solar and Sunnova Energy
Given the investment horizon of 90 days Maxeon Solar Technologies is expected to under-perform the Sunnova Energy. In addition to that, Maxeon Solar is 1.38 times more volatile than Sunnova Energy International. It trades about -0.07 of its total potential returns per unit of risk. Sunnova Energy International is currently generating about 0.0 per unit of volatility. If you would invest 2,020 in Sunnova Energy International on August 30, 2024 and sell it today you would lose (1,479) from holding Sunnova Energy International or give up 73.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maxeon Solar Technologies vs. Sunnova Energy International
Performance |
| Timeline |
| Maxeon Solar Technologies |
| Sunnova Energy Inter |
Maxeon Solar and Sunnova Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maxeon Solar and Sunnova Energy
The main advantage of trading using opposite Maxeon Solar and Sunnova Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maxeon Solar position performs unexpectedly, Sunnova Energy 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 Sunnova Energy will offset losses from the drop in Sunnova Energy's long position.| Maxeon Solar vs. Sunrun Inc | Maxeon Solar vs. Canadian Solar | Maxeon Solar vs. First Solar | Maxeon Solar vs. Sunnova Energy International |
| Sunnova Energy vs. Enphase Energy | Sunnova Energy vs. First Solar | Sunnova Energy vs. SolarEdge Technologies | Sunnova Energy vs. JinkoSolar Holding |
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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