Correlation Between Nissin Foods and Solid Power

Can any of the company-specific risk be diversified away by investing in both Nissin Foods and Solid Power 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 Nissin Foods and Solid Power into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nissin Foods Holdings and Solid Power, you can compare the effects of market volatilities on Nissin Foods and Solid Power 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 Nissin Foods with a short position of Solid Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nissin Foods and Solid Power.

Diversification Opportunities for Nissin Foods and Solid Power

-0.58

Correlation Coefficient

Nissin Foods  Solid Power

Excellent diversification

The 3 months correlation between Nissin and Solid is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Nissin Foods Holdings and Solid Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solid Power and Nissin Foods 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 Nissin Foods Holdings are associated (or correlated) with Solid Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solid Power has no effect on the direction of Nissin Foods i.e., Nissin Foods and Solid Power go up and down completely randomly.

Pair Corralation between Nissin Foods and Solid Power

Assuming the 90 days horizon Nissin Foods Holdings is expected to under-perform the Solid Power. But the pink sheet apears to be less risky and, when comparing its historical volatility, Nissin Foods Holdings is 9.05 times less risky than Solid Power. The pink sheet trades about -0.06 of its potential returns per unit of risk. The Solid Power is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  228.00  in Solid Power on July 5, 2025 and sell it today you would earn a total of  166.00  from holding Solid Power or generate 72.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Nissin Foods Holdings  vs.  Solid Power

Nissin Foods Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days Nissin Foods Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Nissin Foods is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Solid Power

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Solid Power are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain fundamental indicators, Solid Power reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nissin Foods and Solid Power

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

The idea behind Nissin Foods Holdings and Solid Power 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.