Correlation Between FIBRA Storage and First Solar
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By analyzing existing cross correlation between FIBRA Storage and First Solar, you can compare the effects of market volatilities on FIBRA Storage and First 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 FIBRA Storage with a short position of First Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIBRA Storage and First Solar.
Diversification Opportunities for FIBRA Storage and First Solar
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FIBRA and First is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding FIBRA Storage and First Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Solar and FIBRA Storage 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 FIBRA Storage are associated (or correlated) with First Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Solar has no effect on the direction of FIBRA Storage i.e., FIBRA Storage and First Solar go up and down completely randomly.
Pair Corralation between FIBRA Storage and First Solar
Assuming the 90 days trading horizon FIBRA Storage is expected to generate 3.45 times less return on investment than First Solar. But when comparing it to its historical volatility, FIBRA Storage is 3.02 times less risky than First Solar. It trades about 0.02 of its potential returns per unit of risk. First Solar is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 303,500 in First Solar on November 1, 2024 and sell it today you would earn a total of 37,500 from holding First Solar or generate 12.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIBRA Storage vs. First Solar
Performance |
| Timeline |
| FIBRA Storage |
| First Solar |
FIBRA Storage and First Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIBRA Storage and First Solar
The main advantage of trading using opposite FIBRA Storage and First Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIBRA Storage position performs unexpectedly, First 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 First Solar will offset losses from the drop in First Solar's long position.| FIBRA Storage vs. Capital One Financial | FIBRA Storage vs. The Home Depot | FIBRA Storage vs. Grupo Sports World | FIBRA Storage vs. McEwen Mining |
| First Solar vs. Hoteles City Express | First Solar vs. The Home Depot | First Solar vs. Prudential Financial | First Solar vs. United States Steel |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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