Correlation Between Three Sixty and Sunrun
Can any of the company-specific risk be diversified away by investing in both Three Sixty and Sunrun 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 Three Sixty and Sunrun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Three Sixty Solar and Sunrun Inc, you can compare the effects of market volatilities on Three Sixty and Sunrun 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 Three Sixty with a short position of Sunrun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Three Sixty and Sunrun.
Diversification Opportunities for Three Sixty and Sunrun
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Three and Sunrun is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Three Sixty Solar and Sunrun Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunrun Inc and Three Sixty 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 Three Sixty Solar are associated (or correlated) with Sunrun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunrun Inc has no effect on the direction of Three Sixty i.e., Three Sixty and Sunrun go up and down completely randomly.
Pair Corralation between Three Sixty and Sunrun
Assuming the 90 days horizon Three Sixty Solar is expected to under-perform the Sunrun. In addition to that, Three Sixty is 3.91 times more volatile than Sunrun Inc. It trades about -0.25 of its total potential returns per unit of risk. Sunrun Inc is currently generating about -0.08 per unit of volatility. If you would invest 1,443 in Sunrun Inc on August 28, 2024 and sell it today you would lose (291.00) from holding Sunrun Inc or give up 20.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Three Sixty Solar vs. Sunrun Inc
Performance |
| Timeline |
| Three Sixty Solar |
| Sunrun Inc |
Three Sixty and Sunrun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Three Sixty and Sunrun
The main advantage of trading using opposite Three Sixty and Sunrun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Three Sixty position performs unexpectedly, Sunrun 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 Sunrun will offset losses from the drop in Sunrun's long position.The idea behind Three Sixty Solar and Sunrun Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sunrun vs. Maxeon Solar Technologies | Sunrun vs. Canadian Solar | Sunrun vs. First Solar | Sunrun vs. Sunnova Energy International |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |