Correlation Between SolarEdge Technologies and Sunnova Energy
Can any of the company-specific risk be diversified away by investing in both SolarEdge Technologies and Sunnova 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 SolarEdge Technologies and Sunnova Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SolarEdge Technologies and Sunnova Energy International, you can compare the effects of market volatilities on SolarEdge Technologies and Sunnova 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 SolarEdge Technologies with a short position of Sunnova Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of SolarEdge Technologies and Sunnova Energy.
Diversification Opportunities for SolarEdge Technologies and Sunnova Energy
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SolarEdge and Sunnova is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding SolarEdge Technologies and Sunnova Energy International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunnova Energy Inter and SolarEdge Technologies 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 SolarEdge Technologies are associated (or correlated) with Sunnova Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunnova Energy Inter has no effect on the direction of SolarEdge Technologies i.e., SolarEdge Technologies and Sunnova Energy go up and down completely randomly.
Pair Corralation between SolarEdge Technologies and Sunnova Energy
Given the investment horizon of 90 days SolarEdge Technologies is expected to generate 0.53 times more return on investment than Sunnova Energy. However, SolarEdge Technologies is 1.89 times less risky than Sunnova Energy. It trades about -0.06 of its potential returns per unit of risk. Sunnova Energy International is currently generating about -0.13 per unit of risk. If you would invest 6,556 in SolarEdge Technologies on January 29, 2024 and sell it today you would lose (736.00) from holding SolarEdge Technologies or give up 11.23% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
SolarEdge Technologies vs. Sunnova Energy International
Performance |
Timeline |
SolarEdge Technologies |
Sunnova Energy Inter |
SolarEdge Technologies and Sunnova Energy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SolarEdge Technologies and Sunnova Energy
The main advantage of trading using opposite SolarEdge Technologies and Sunnova Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SolarEdge Technologies position performs unexpectedly, Sunnova 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 Sunnova Energy will offset losses from the drop in Sunnova Energy's long position.SolarEdge Technologies vs. First Solar | SolarEdge Technologies vs. Sunrun Inc | SolarEdge Technologies vs. Canadian Solar | SolarEdge Technologies vs. SunPower |
Sunnova Energy vs. SunPower | Sunnova Energy vs. Enphase Energy | Sunnova Energy vs. First Solar | Sunnova Energy vs. SolarEdge 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |