Correlation Between SUNation Energy and SinglePoint
Can any of the company-specific risk be diversified away by investing in both SUNation Energy and SinglePoint 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 SUNation Energy and SinglePoint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SUNation Energy and SinglePoint, you can compare the effects of market volatilities on SUNation Energy and SinglePoint 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 SUNation Energy with a short position of SinglePoint. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUNation Energy and SinglePoint.
Diversification Opportunities for SUNation Energy and SinglePoint
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SUNation and SinglePoint is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding SUNation Energy and SinglePoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SinglePoint and SUNation 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 SUNation Energy are associated (or correlated) with SinglePoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SinglePoint has no effect on the direction of SUNation Energy i.e., SUNation Energy and SinglePoint go up and down completely randomly.
Pair Corralation between SUNation Energy and SinglePoint
Given the investment horizon of 90 days SUNation Energy is expected to under-perform the SinglePoint. But the stock apears to be less risky and, when comparing its historical volatility, SUNation Energy is 7.24 times less risky than SinglePoint. The stock trades about -0.19 of its potential returns per unit of risk. The SinglePoint is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1.30 in SinglePoint on November 2, 2024 and sell it today you would earn a total of 2.30 from holding SinglePoint or generate 176.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 31.15% |
| Values | Daily Returns |
SUNation Energy vs. SinglePoint
Performance |
| Timeline |
| SUNation Energy |
| SinglePoint |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
SUNation Energy and SinglePoint Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SUNation Energy and SinglePoint
The main advantage of trading using opposite SUNation Energy and SinglePoint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SUNation Energy position performs unexpectedly, SinglePoint 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 SinglePoint will offset losses from the drop in SinglePoint's long position.| SUNation Energy vs. Summit Materials | SUNation Energy vs. Cedar Realty Trust | SUNation Energy vs. Getty Copper | SUNation Energy vs. Catalyst Metals Limited |
| SinglePoint vs. China Changjiang Mining | SinglePoint vs. FTC Solar | SinglePoint vs. Solar Integrated Roofing | SinglePoint vs. Ascent Solar Technologies, |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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