Correlation Between Sunny Optical and Tatton Asset
Can any of the company-specific risk be diversified away by investing in both Sunny Optical and Tatton Asset 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 Tatton Asset 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 Tatton Asset Management, you can compare the effects of market volatilities on Sunny Optical and Tatton Asset 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 Tatton Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Optical and Tatton Asset.
Diversification Opportunities for Sunny Optical and Tatton Asset
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sunny and Tatton is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Optical Technology and Tatton Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tatton Asset Management 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 Tatton Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tatton Asset Management has no effect on the direction of Sunny Optical i.e., Sunny Optical and Tatton Asset go up and down completely randomly.
Pair Corralation between Sunny Optical and Tatton Asset
Assuming the 90 days trading horizon Sunny Optical is expected to generate 1.54 times less return on investment than Tatton Asset. In addition to that, Sunny Optical is 2.28 times more volatile than Tatton Asset Management. It trades about 0.02 of its total potential returns per unit of risk. Tatton Asset Management is currently generating about 0.08 per unit of volatility. If you would invest 51,866 in Tatton Asset Management on September 24, 2024 and sell it today you would earn a total of 17,134 from holding Tatton Asset Management or generate 33.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.41% |
| Values | Daily Returns |
Sunny Optical Technology vs. Tatton Asset Management
Performance |
| Timeline |
| Sunny Optical Technology |
| Tatton Asset Management |
Sunny Optical and Tatton Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Optical and Tatton Asset
The main advantage of trading using opposite Sunny Optical and Tatton Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Optical position performs unexpectedly, Tatton Asset 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 Tatton Asset will offset losses from the drop in Tatton Asset's long position.| Sunny Optical vs. Uniper SE | Sunny Optical vs. Mulberry Group PLC | Sunny Optical vs. London Security Plc | Sunny Optical vs. Triad Group PLC |
| Tatton Asset vs. Samsung Electronics Co | Tatton Asset vs. Samsung Electronics Co | Tatton Asset vs. Hyundai Motor | Tatton Asset 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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