Correlation Between Nano Labs and Canadian Solar
Can any of the company-specific risk be diversified away by investing in both Nano Labs and Canadian 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 Nano Labs and Canadian Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nano Labs and Canadian Solar, you can compare the effects of market volatilities on Nano Labs and Canadian 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 Nano Labs with a short position of Canadian Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nano Labs and Canadian Solar.
Diversification Opportunities for Nano Labs and Canadian Solar
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nano and Canadian is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Nano Labs and Canadian Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Solar and Nano Labs 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 Nano Labs are associated (or correlated) with Canadian Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Solar has no effect on the direction of Nano Labs i.e., Nano Labs and Canadian Solar go up and down completely randomly.
Pair Corralation between Nano Labs and Canadian Solar
Allowing for the 90-day total investment horizon Nano Labs is expected to generate 3.28 times more return on investment than Canadian Solar. However, Nano Labs is 3.28 times more volatile than Canadian Solar. It trades about 0.04 of its potential returns per unit of risk. Canadian Solar is currently generating about -0.05 per unit of risk. If you would invest 1,900 in Nano Labs on September 19, 2024 and sell it today you would lose (973.00) from holding Nano Labs or give up 51.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nano Labs vs. Canadian Solar
Performance |
| Timeline |
| Nano Labs |
| Canadian Solar |
Nano Labs and Canadian Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nano Labs and Canadian Solar
The main advantage of trading using opposite Nano Labs and Canadian Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nano Labs position performs unexpectedly, Canadian 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 Canadian Solar will offset losses from the drop in Canadian Solar's long position.| Nano Labs vs. SEALSQ Corp | Nano Labs vs. GSI Technology | Nano Labs vs. SemiLEDS | Nano Labs vs. ChipMOS 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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