Correlation Between TGI Solar and Aurora Solar
Can any of the company-specific risk be diversified away by investing in both TGI Solar and Aurora 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 TGI Solar and Aurora Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TGI Solar Power and Aurora Solar Technologies, you can compare the effects of market volatilities on TGI Solar and Aurora 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 TGI Solar with a short position of Aurora Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of TGI Solar and Aurora Solar.
Diversification Opportunities for TGI Solar and Aurora Solar
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TGI and Aurora is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding TGI Solar Power and Aurora Solar Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Solar Technologies and TGI Solar 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 TGI Solar Power are associated (or correlated) with Aurora Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Solar Technologies has no effect on the direction of TGI Solar i.e., TGI Solar and Aurora Solar go up and down completely randomly.
Pair Corralation between TGI Solar and Aurora Solar
Given the investment horizon of 90 days TGI Solar Power is expected to generate 0.97 times more return on investment than Aurora Solar. However, TGI Solar Power is 1.03 times less risky than Aurora Solar. It trades about 0.0 of its potential returns per unit of risk. Aurora Solar Technologies is currently generating about 0.0 per unit of risk. If you would invest 0.10 in TGI Solar Power on September 1, 2024 and sell it today you would lose (0.02) from holding TGI Solar Power or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TGI Solar Power vs. Aurora Solar Technologies
Performance |
| Timeline |
| TGI Solar Power |
| Aurora Solar Technologies |
TGI Solar and Aurora Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TGI Solar and Aurora Solar
The main advantage of trading using opposite TGI Solar and Aurora Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TGI Solar position performs unexpectedly, Aurora 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 Aurora Solar will offset losses from the drop in Aurora Solar's long position.| TGI Solar vs. Ascent Solar Technologies, | TGI Solar vs. SinglePoint | TGI Solar vs. SunHydrogen | TGI Solar vs. Sunrun Inc |
| Aurora Solar vs. BCE Inc | Aurora Solar vs. Axiologix | Aurora Solar vs. Advanced Info Service | Aurora Solar vs. HUMANA INC |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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