Correlation Between SPI Energy and Xilinx

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

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

Diversification Opportunities for SPI Energy and Xilinx

0.0

Correlation Coefficient

SPI Energy  Xilinx

Pay attention - limited upside

The 3 months correlation between SPI and Xilinx is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SPI Energy Co and Xilinx Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xilinx Inc and SPI Energy 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 SPI Energy Co are associated (or correlated) with Xilinx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xilinx Inc has no effect on the direction of SPI Energy i.e., SPI Energy and Xilinx go up and down completely randomly.

Pair Corralation between SPI Energy and Xilinx

If you would invest (100.00) in Xilinx Inc on January 20, 2024 and sell it today you would earn a total of  100.00  from holding Xilinx Inc or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

SPI Energy Co  vs.  Xilinx Inc

SPI Energy

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SPI Energy Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in May 2024. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Xilinx Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xilinx Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Xilinx is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with SPI Energy and Xilinx

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

The idea behind SPI Energy Co and Xilinx Inc 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.