Correlation Between Intel and Canadian Solar
Can any of the company-specific risk be diversified away by investing in both Intel and Canadian 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 Intel and Canadian Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Canadian Solar, you can compare the effects of market volatilities on Intel and Canadian 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 Intel with a short position of Canadian Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Canadian Solar.
Diversification Opportunities for Intel and Canadian Solar
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Intel and Canadian is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Canadian Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Solar and Intel 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 Intel are associated (or correlated) with Canadian Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Solar has no effect on the direction of Intel i.e., Intel and Canadian Solar go up and down completely randomly.
Pair Corralation between Intel and Canadian Solar
Given the investment horizon of 90 days Intel is expected to generate 4.0 times less return on investment than Canadian Solar. But when comparing it to its historical volatility, Intel is 1.93 times less risky than Canadian Solar. It trades about 0.09 of its potential returns per unit of risk. Canadian Solar is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 786.00 in Canadian Solar on April 23, 2025 and sell it today you would earn a total of 504.00 from holding Canadian Solar or generate 64.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Intel vs. Canadian Solar
Performance |
Timeline |
Intel |
Canadian Solar |
Intel and Canadian Solar Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Intel and Canadian Solar
The main advantage of trading using opposite Intel and Canadian Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Canadian 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 Canadian Solar will offset losses from the drop in Canadian Solar's long position.The idea behind Intel and Canadian Solar 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.Canadian Solar vs. JinkoSolar Holding | Canadian Solar vs. First Solar | Canadian Solar vs. Complete Solaria, | Canadian Solar 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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