Correlation Between Firsthand Alternative and State Street

Can any of the company-specific risk be diversified away by investing in both Firsthand Alternative and State Street 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 Firsthand Alternative and State Street into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Firsthand Alternative Energy and State Street Premier, you can compare the effects of market volatilities on Firsthand Alternative and State Street 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 Firsthand Alternative with a short position of State Street. Check out your portfolio center. Please also check ongoing floating volatility patterns of Firsthand Alternative and State Street.

Diversification Opportunities for Firsthand Alternative and State Street

0.83

Correlation Coefficient

Firsthand Alternative  State Street

Very poor diversification

The 3 months correlation between Firsthand and State is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Firsthand Alternative Energy and State Street Premier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Street Premier and Firsthand Alternative 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 Firsthand Alternative Energy are associated (or correlated) with State Street. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Street Premier has no effect on the direction of Firsthand Alternative i.e., Firsthand Alternative and State Street go up and down completely randomly.

Pair Corralation between Firsthand Alternative and State Street

Assuming the 90 days horizon Firsthand Alternative Energy is expected to generate 2.35 times more return on investment than State Street. However, Firsthand Alternative is 2.35 times more volatile than State Street Premier. It trades about 0.07 of its potential returns per unit of risk. State Street Premier is currently generating about 0.04 per unit of risk. If you would invest  1,081  in Firsthand Alternative Energy on August 26, 2025 and sell it today you would earn a total of  99.00  from holding Firsthand Alternative Energy or generate 9.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Firsthand Alternative Energy  vs.  State Street Premier

Firsthand Alternative

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Firsthand Alternative Energy are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Firsthand Alternative may actually be approaching a critical reversion point that can send shares even higher in December 2025.

State Street Premier

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in State Street Premier are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, State Street is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Firsthand Alternative and State Street

The main advantage of trading using opposite Firsthand Alternative and State Street positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Firsthand Alternative position performs unexpectedly, State Street 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 State Street will offset losses from the drop in State Street's long position.

The idea behind Firsthand Alternative Energy and State Street Premier 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.