Correlation Between OppFi and Xinyi Solar
Can any of the company-specific risk be diversified away by investing in both OppFi and Xinyi 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 OppFi and Xinyi Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OppFi Inc and Xinyi Solar Holdings, you can compare the effects of market volatilities on OppFi and Xinyi 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 OppFi with a short position of Xinyi Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of OppFi and Xinyi Solar.
Diversification Opportunities for OppFi and Xinyi Solar
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OppFi and Xinyi is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding OppFi Inc and Xinyi Solar Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinyi Solar Holdings and OppFi 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 OppFi Inc are associated (or correlated) with Xinyi Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinyi Solar Holdings has no effect on the direction of OppFi i.e., OppFi and Xinyi Solar go up and down completely randomly.
Pair Corralation between OppFi and Xinyi Solar
Given the investment horizon of 90 days OppFi Inc is expected to generate 2.3 times more return on investment than Xinyi Solar. However, OppFi is 2.3 times more volatile than Xinyi Solar Holdings. It trades about 0.38 of its potential returns per unit of risk. Xinyi Solar Holdings is currently generating about 0.13 per unit of risk. If you would invest 858.00 in OppFi Inc on November 4, 2024 and sell it today you would earn a total of 513.00 from holding OppFi Inc or generate 59.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
OppFi Inc vs. Xinyi Solar Holdings
Performance |
| Timeline |
| OppFi Inc |
| Xinyi Solar Holdings |
OppFi and Xinyi Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OppFi and Xinyi Solar
The main advantage of trading using opposite OppFi and Xinyi Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OppFi position performs unexpectedly, Xinyi 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 Xinyi Solar will offset losses from the drop in Xinyi Solar's long position.The idea behind OppFi Inc and Xinyi Solar Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Xinyi Solar vs. ClearVue Technologies Limited | Xinyi Solar vs. Meyer Burger Technology | Xinyi Solar vs. Go Solar USA | Xinyi Solar vs. Principal 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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