Correlation Between Profithol and Solaria Energa

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

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

Diversification Opportunities for Profithol and Solaria Energa

-0.65

Correlation Coefficient

Profithol  Solaria Energa

Excellent diversification

The 3 months correlation between Profithol and Solaria is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Profithol SA 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 Profithol 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 Profithol SA 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 Profithol i.e., Profithol and Solaria Energa go up and down completely randomly.

Pair Corralation between Profithol and Solaria Energa

Assuming the 90 days trading horizon Profithol SA is expected to under-perform the Solaria Energa. In addition to that, Profithol is 1.25 times more volatile than Solaria Energa y. It trades about -0.07 of its total potential returns per unit of risk. Solaria Energa y is currently generating about 0.24 per unit of volatility. If you would invest  675.00  in Solaria Energa y on April 22, 2025 and sell it today you would earn a total of  365.00  from holding Solaria Energa y or generate 54.07% return on investment over 90 days.

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

Profithol SA  vs.  Solaria Energa y

Profithol SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Profithol SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical indicators remain rather sound which may send shares a bit higher in August 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

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 18 (%) 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 Profithol and Solaria Energa

The main advantage of trading using opposite Profithol and Solaria Energa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Profithol 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 Profithol SA 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.