Correlation Between Sunny Optical and Albion Technology
Can any of the company-specific risk be diversified away by investing in both Sunny Optical and Albion Technology 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 Sunny Optical and Albion Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunny Optical Technology and Albion Technology General, you can compare the effects of market volatilities on Sunny Optical and Albion Technology 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 Sunny Optical with a short position of Albion Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Optical and Albion Technology.
Diversification Opportunities for Sunny Optical and Albion Technology
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sunny and Albion is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Optical Technology and Albion Technology General in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Albion Technology General and Sunny Optical 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 Sunny Optical Technology are associated (or correlated) with Albion Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Albion Technology General has no effect on the direction of Sunny Optical i.e., Sunny Optical and Albion Technology go up and down completely randomly.
Pair Corralation between Sunny Optical and Albion Technology
Assuming the 90 days trading horizon Sunny Optical Technology is expected to generate 2.83 times more return on investment than Albion Technology. However, Sunny Optical is 2.83 times more volatile than Albion Technology General. It trades about 0.19 of its potential returns per unit of risk. Albion Technology General is currently generating about -0.05 per unit of risk. If you would invest 4,915 in Sunny Optical Technology on August 28, 2024 and sell it today you would earn a total of 815.00 from holding Sunny Optical Technology or generate 16.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunny Optical Technology vs. Albion Technology General
Performance |
| Timeline |
| Sunny Optical Technology |
| Albion Technology General |
Sunny Optical and Albion Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Optical and Albion Technology
The main advantage of trading using opposite Sunny Optical and Albion Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Optical position performs unexpectedly, Albion Technology 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 Albion Technology will offset losses from the drop in Albion Technology's long position.| Sunny Optical vs. Samsung Electronics Co | Sunny Optical vs. Samsung Electronics Co | Sunny Optical vs. Hyundai Motor | Sunny Optical vs. Toyota Motor Corp |
| Albion Technology vs. Samsung Electronics Co | Albion Technology vs. Samsung Electronics Co | Albion Technology vs. Hyundai Motor | Albion Technology vs. Toyota Motor Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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