Correlation Between Solar Integrated and VivoPower International
Can any of the company-specific risk be diversified away by investing in both Solar Integrated and VivoPower International 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 VivoPower International 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 VivoPower International PLC, you can compare the effects of market volatilities on Solar Integrated and VivoPower International 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 VivoPower International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solar Integrated and VivoPower International.
Diversification Opportunities for Solar Integrated and VivoPower International
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Solar and VivoPower is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Solar Integrated Roofing and VivoPower International PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VivoPower International 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 VivoPower International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VivoPower International has no effect on the direction of Solar Integrated i.e., Solar Integrated and VivoPower International go up and down completely randomly.
Pair Corralation between Solar Integrated and VivoPower International
Given the investment horizon of 90 days Solar Integrated Roofing is expected to generate 2.34 times more return on investment than VivoPower International. However, Solar Integrated is 2.34 times more volatile than VivoPower International PLC. It trades about 0.1 of its potential returns per unit of risk. VivoPower International PLC is currently generating about 0.15 per unit of risk. If you would invest 0.02 in Solar Integrated Roofing on August 28, 2024 and sell it today you would lose (0.01) from holding Solar Integrated Roofing or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solar Integrated Roofing vs. VivoPower International PLC
Performance |
| Timeline |
| Solar Integrated Roofing |
| VivoPower International |
Solar Integrated and VivoPower International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solar Integrated and VivoPower International
The main advantage of trading using opposite Solar Integrated and VivoPower International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solar Integrated position performs unexpectedly, VivoPower International 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 VivoPower International will offset losses from the drop in VivoPower International's long position.| Solar Integrated vs. Newhydrogen | Solar Integrated vs. Ascent Solar Technologies, | Solar Integrated vs. TGI Solar Power | Solar Integrated vs. Clear Blue Technologies |
| VivoPower International vs. Emeren Group | VivoPower International vs. Tigo Energy | VivoPower International vs. Sunrun Inc | VivoPower International vs. Sunnova Energy International |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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