Correlation Between Navitas Semiconductor and FTC Solar
Can any of the company-specific risk be diversified away by investing in both Navitas Semiconductor 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 Navitas Semiconductor and FTC Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Navitas Semiconductor Corp and FTC Solar, you can compare the effects of market volatilities on Navitas Semiconductor 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 Navitas Semiconductor with a short position of FTC Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Navitas Semiconductor and FTC Solar.
Diversification Opportunities for Navitas Semiconductor and FTC Solar
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Navitas and FTC is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Navitas Semiconductor Corp and FTC Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTC Solar and Navitas Semiconductor 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 Navitas Semiconductor Corp 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 Navitas Semiconductor i.e., Navitas Semiconductor and FTC Solar go up and down completely randomly.
Pair Corralation between Navitas Semiconductor and FTC Solar
Given the investment horizon of 90 days Navitas Semiconductor Corp is expected to generate 0.87 times more return on investment than FTC Solar. However, Navitas Semiconductor Corp is 1.15 times less risky than FTC Solar. It trades about 0.06 of its potential returns per unit of risk. FTC Solar is currently generating about -0.07 per unit of risk. If you would invest 224.00 in Navitas Semiconductor Corp on August 25, 2024 and sell it today you would earn a total of 18.00 from holding Navitas Semiconductor Corp or generate 8.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Navitas Semiconductor Corp vs. FTC Solar
Performance |
| Timeline |
| Navitas Semiconductor |
| FTC Solar |
Navitas Semiconductor and FTC Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Navitas Semiconductor and FTC Solar
The main advantage of trading using opposite Navitas Semiconductor and FTC Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Navitas Semiconductor 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.| Navitas Semiconductor vs. ON Semiconductor | Navitas Semiconductor vs. Monolithic Power Systems | Navitas Semiconductor vs. Globalfoundries | Navitas Semiconductor vs. Analog Devices |
| FTC Solar vs. Sunnova Energy International | FTC Solar vs. JinkoSolar Holding | FTC Solar vs. Nextracker Class A | FTC Solar vs. Canadian Solar |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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