Correlation Between Xinyi Solar and SPI Energy
Can any of the company-specific risk be diversified away by investing in both Xinyi Solar and SPI Energy 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 Xinyi Solar and SPI Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xinyi Solar Holdings and SPI Energy Co, you can compare the effects of market volatilities on Xinyi Solar and SPI Energy 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 Xinyi Solar with a short position of SPI Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinyi Solar and SPI Energy.
Diversification Opportunities for Xinyi Solar and SPI Energy
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Xinyi and SPI is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Xinyi Solar Holdings and SPI Energy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPI Energy and Xinyi 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 Xinyi Solar Holdings are associated (or correlated) with SPI Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPI Energy has no effect on the direction of Xinyi Solar i.e., Xinyi Solar and SPI Energy go up and down completely randomly.
Pair Corralation between Xinyi Solar and SPI Energy
Assuming the 90 days horizon Xinyi Solar Holdings is expected to generate 0.59 times more return on investment than SPI Energy. However, Xinyi Solar Holdings is 1.69 times less risky than SPI Energy. It trades about -0.04 of its potential returns per unit of risk. SPI Energy Co is currently generating about -0.04 per unit of risk. If you would invest 1,994 in Xinyi Solar Holdings on September 1, 2024 and sell it today you would lose (1,156) from holding Xinyi Solar Holdings or give up 57.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinyi Solar Holdings vs. SPI Energy Co
Performance |
| Timeline |
| Xinyi Solar Holdings |
| SPI Energy |
Xinyi Solar and SPI Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinyi Solar and SPI Energy
The main advantage of trading using opposite Xinyi Solar and SPI Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinyi Solar position performs unexpectedly, SPI Energy 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 SPI Energy will offset losses from the drop in SPI Energy's long position.| Xinyi Solar vs. SMA Solar Technology | Xinyi Solar vs. Xinyi Solar Holdings | Xinyi Solar vs. Sunrun Inc | Xinyi Solar vs. SMA Solar Technology |
| SPI Energy vs. Ascent Solar Technologies, | SPI Energy vs. Emeren Group | SPI Energy vs. Sunrun Inc | SPI Energy 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 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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