Correlation Between Solar Integrated and Sunnova Energy
Can any of the company-specific risk be diversified away by investing in both Solar Integrated 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 Solar Integrated and Sunnova Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solar Integrated Roofing and Sunnova Energy International, you can compare the effects of market volatilities on Solar Integrated 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 Solar Integrated with a short position of Sunnova Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solar Integrated and Sunnova Energy.
Diversification Opportunities for Solar Integrated and Sunnova Energy
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Solar and Sunnova is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Solar Integrated Roofing 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 Solar Integrated 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 Solar Integrated Roofing 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 Solar Integrated i.e., Solar Integrated and Sunnova Energy go up and down completely randomly.
Pair Corralation between Solar Integrated and Sunnova Energy
Given the investment horizon of 90 days Solar Integrated Roofing is expected to generate 3.87 times more return on investment than Sunnova Energy. However, Solar Integrated is 3.87 times more volatile than Sunnova Energy International. It trades about 0.02 of its potential returns per unit of risk. Sunnova Energy International is currently generating about -0.01 per unit of risk. If you would invest 1,602 in Solar Integrated Roofing on September 3, 2024 and sell it today you would lose (1,602) from holding Solar Integrated Roofing or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Solar Integrated Roofing vs. Sunnova Energy International
Performance |
| Timeline |
| Solar Integrated Roofing |
| Sunnova Energy Inter |
Solar Integrated and Sunnova Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solar Integrated and Sunnova Energy
The main advantage of trading using opposite Solar Integrated and Sunnova Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solar Integrated 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.| Solar Integrated vs. Newhydrogen | Solar Integrated vs. Ascent Solar Technologies, | Solar Integrated vs. SinglePoint | Solar Integrated vs. TGI Solar Power |
| 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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