Correlation Between News Corp and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both News Corp and Sunny Optical 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 News Corp and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between News Corp Cl and Sunny Optical Technology, you can compare the effects of market volatilities on News Corp and Sunny Optical 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 News Corp with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of News Corp and Sunny Optical.
Diversification Opportunities for News Corp and Sunny Optical
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between News and Sunny is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding News Corp Cl and Sunny Optical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Optical Technology and News Corp 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 News Corp Cl are associated (or correlated) with Sunny Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Optical Technology has no effect on the direction of News Corp i.e., News Corp and Sunny Optical go up and down completely randomly.
Pair Corralation between News Corp and Sunny Optical
Assuming the 90 days trading horizon News Corp Cl is expected to generate 0.48 times more return on investment than Sunny Optical. However, News Corp Cl is 2.07 times less risky than Sunny Optical. It trades about 0.06 of its potential returns per unit of risk. Sunny Optical Technology is currently generating about 0.0 per unit of risk. If you would invest 1,884 in News Corp Cl on September 3, 2024 and sell it today you would earn a total of 1,030 from holding News Corp Cl or generate 54.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.88% |
| Values | Daily Returns |
News Corp Cl vs. Sunny Optical Technology
Performance |
| Timeline |
| News Corp Cl |
| Sunny Optical Technology |
News Corp and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with News Corp and Sunny Optical
The main advantage of trading using opposite News Corp and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if News Corp position performs unexpectedly, Sunny Optical 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 Sunny Optical will offset losses from the drop in Sunny Optical's long position.| News Corp vs. Sunny Optical Technology | News Corp vs. Vitec Software Group | News Corp vs. Take Two Interactive Software | News Corp vs. Zurich Insurance Group |
| Sunny Optical vs. Catalyst Media Group | Sunny Optical vs. CATLIN GROUP | Sunny Optical vs. Magnora ASA | Sunny Optical vs. RTW Venture Fund |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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