Correlation Between SPI Energy and FTC Solar
Can any of the company-specific risk be diversified away by investing in both SPI Energy 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 SPI Energy and FTC Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPI Energy Co and FTC Solar, you can compare the effects of market volatilities on SPI Energy 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 SPI Energy with a short position of FTC Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPI Energy and FTC Solar.
Diversification Opportunities for SPI Energy and FTC Solar
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPI and FTC is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding SPI Energy Co and FTC Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FTC Solar and SPI Energy 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 SPI Energy Co 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 SPI Energy i.e., SPI Energy and FTC Solar go up and down completely randomly.
Pair Corralation between SPI Energy and FTC Solar
If you would invest 293.00 in FTC Solar on January 4, 2025 and sell it today you would earn a total of 2.00 from holding FTC Solar or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
SPI Energy Co vs. FTC Solar
Performance |
| Timeline |
| SPI Energy |
Risk-Adjusted Performance
Modest
Weak | Strong |
| FTC Solar |
SPI Energy and FTC Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPI Energy and FTC Solar
The main advantage of trading using opposite SPI Energy and FTC Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPI Energy 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.| SPI Energy vs. Ascent Solar Technologies, | SPI Energy vs. Emeren Group | SPI Energy vs. Sunrun Inc | SPI Energy vs. Sunnova Energy International |
| 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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