Correlation Between Sunrun and Ascent Solar

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

By analyzing existing cross correlation between Sunrun Inc and Ascent Solar Technologies,, you can compare the effects of market volatilities on Sunrun and Ascent 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 Sunrun with a short position of Ascent Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunrun and Ascent Solar.

Diversification Opportunities for Sunrun and Ascent Solar

0.23

Correlation Coefficient

Sunrun  Ascent Solar

Modest diversification

The 3 months correlation between Sunrun and Ascent is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Sunrun Inc and Ascent Solar Technologies, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascent Solar Technol and Sunrun 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 Sunrun Inc are associated (or correlated) with Ascent Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascent Solar Technol has no effect on the direction of Sunrun i.e., Sunrun and Ascent Solar go up and down completely randomly.

Pair Corralation between Sunrun and Ascent Solar

Considering the 90-day investment horizon Sunrun Inc is expected to under-perform the Ascent Solar. But the stock apears to be less risky and, when comparing its historical volatility, Sunrun Inc is 1.08 times less risky than Ascent Solar. The stock trades about -0.13 of its potential returns per unit of risk. The Ascent Solar Technologies, is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  313.00  in Ascent Solar Technologies, on August 30, 2024 and sell it today you would lose (61.00) from holding Ascent Solar Technologies, or give up 19.49% of portfolio value over 90 days.

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

Sunrun Inc  vs.  Ascent Solar Technologies,

Sunrun Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sunrun Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in December 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Ascent Solar Technol

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ascent Solar Technologies, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Sunrun and Ascent Solar

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

The idea behind Sunrun Inc and Ascent Solar Technologies, 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.