Correlation Between Neinor Homes and Solaria Energa

Can any of the company-specific risk be diversified away by investing in both Neinor Homes and Solaria Energa 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 Neinor Homes and Solaria Energa into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Neinor Homes SLU and Solaria Energa y, you can compare the effects of market volatilities on Neinor Homes and Solaria Energa 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 Neinor Homes with a short position of Solaria Energa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neinor Homes and Solaria Energa.

Diversification Opportunities for Neinor Homes and Solaria Energa

0.75

Correlation Coefficient

Neinor Homes  Solaria Energa

Poor diversification

The 3 months correlation between Neinor and Solaria is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Neinor Homes SLU and Solaria Energa y in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solaria Energa y and Neinor Homes 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 Neinor Homes SLU are associated (or correlated) with Solaria Energa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solaria Energa y has no effect on the direction of Neinor Homes i.e., Neinor Homes and Solaria Energa go up and down completely randomly.

Pair Corralation between Neinor Homes and Solaria Energa

Assuming the 90 days trading horizon Neinor Homes is expected to generate 1.04 times less return on investment than Solaria Energa. But when comparing it to its historical volatility, Neinor Homes SLU is 1.02 times less risky than Solaria Energa. It trades about 0.21 of its potential returns per unit of risk. Solaria Energa y is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  984.00  in Solaria Energa y on April 23, 2025 and sell it today you would earn a total of  77.00  from holding Solaria Energa y or generate 7.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.45%
Values	Daily Returns

Neinor Homes SLU  vs.  Solaria Energa y

Neinor Homes SLU

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Neinor Homes SLU are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Neinor Homes exhibited solid returns over the last few months and may actually be approaching a breakup point.

Solaria Energa y

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Solaria Energa y are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Solaria Energa exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Neinor Homes and Solaria Energa

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

The idea behind Neinor Homes SLU and Solaria Energa y 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.