Correlation Between FTC Solar and First Solar
Can any of the company-specific risk be diversified away by investing in both FTC Solar and First 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 FTC Solar and First Solar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FTC Solar and First Solar, you can compare the effects of market volatilities on FTC Solar and First 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 FTC Solar with a short position of First Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of FTC Solar and First Solar.
Diversification Opportunities for FTC Solar and First Solar
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FTC and First is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding FTC Solar and First Solar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Solar and FTC Solar 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 FTC Solar are associated (or correlated) with First Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Solar has no effect on the direction of FTC Solar i.e., FTC Solar and First Solar go up and down completely randomly.
Pair Corralation between FTC Solar and First Solar
Given the investment horizon of 90 days FTC Solar is expected to generate 1.27 times more return on investment than First Solar. However, FTC Solar is 1.27 times more volatile than First Solar. It trades about 0.18 of its potential returns per unit of risk. First Solar is currently generating about 0.11 per unit of risk. If you would invest 417.00 in FTC Solar on May 29, 2025 and sell it today you would earn a total of 281.00 from holding FTC Solar or generate 67.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FTC Solar vs. First Solar
Performance |
| Timeline |
| FTC Solar |
| First Solar |
FTC Solar and First Solar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FTC Solar and First Solar
The main advantage of trading using opposite FTC Solar and First Solar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FTC Solar position performs unexpectedly, First 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 First Solar will offset losses from the drop in First Solar's long position.| FTC Solar vs. Maxeon Solar Technologies | FTC Solar vs. Nextracker Class A | FTC Solar vs. Shoals Technologies Group | FTC Solar vs. Array Technologies |
| First Solar vs. SolarEdge Technologies | First Solar vs. Enphase Energy | First Solar vs. Canadian Solar | First Solar vs. Sunrun Inc |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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