Correlation Between Super Energy and Solartron Public
Can any of the company-specific risk be diversified away by investing in both Super Energy and Solartron Public 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 Super Energy and Solartron Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Super Energy and Solartron Public, you can compare the effects of market volatilities on Super Energy and Solartron Public 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 Super Energy with a short position of Solartron Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Energy and Solartron Public.
Diversification Opportunities for Super Energy and Solartron Public
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Super and Solartron is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Super Energy and Solartron Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solartron Public and Super 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 Super Energy are associated (or correlated) with Solartron Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solartron Public has no effect on the direction of Super Energy i.e., Super Energy and Solartron Public go up and down completely randomly.
Pair Corralation between Super Energy and Solartron Public
Assuming the 90 days trading horizon Super Energy is expected to generate 0.92 times more return on investment than Solartron Public. However, Super Energy is 1.09 times less risky than Solartron Public. It trades about -0.06 of its potential returns per unit of risk. Solartron Public is currently generating about -0.16 per unit of risk. If you would invest 28.00 in Super Energy on September 4, 2024 and sell it today you would lose (1.00) from holding Super Energy or give up 3.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Super Energy vs. Solartron Public
Performance |
| Timeline |
| Super Energy |
| Solartron Public |
Super Energy and Solartron Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Energy and Solartron Public
The main advantage of trading using opposite Super Energy and Solartron Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Energy position performs unexpectedly, Solartron Public 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 Solartron Public will offset losses from the drop in Solartron Public's long position.| Super Energy vs. Bangchak Public | Super Energy vs. Gulf Energy Development | Super Energy vs. Bangkok Expressway and | Super Energy vs. BGrimm Power Public |
| Solartron Public vs. Asia Aviation Public | Solartron Public vs. Bangkok Dusit Medical | Solartron Public vs. Bangkok Expressway and | Solartron Public vs. Airports of Thailand |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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