Correlation Between Sumitomo Rubber and DATAGROUP
Can any of the company-specific risk be diversified away by investing in both Sumitomo Rubber and DATAGROUP 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 Sumitomo Rubber and DATAGROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumitomo Rubber Industries and DATAGROUP SE, you can compare the effects of market volatilities on Sumitomo Rubber and DATAGROUP 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 Sumitomo Rubber with a short position of DATAGROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumitomo Rubber and DATAGROUP.
Diversification Opportunities for Sumitomo Rubber and DATAGROUP
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sumitomo and DATAGROUP is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Sumitomo Rubber Industries and DATAGROUP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATAGROUP SE and Sumitomo Rubber 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 Sumitomo Rubber Industries are associated (or correlated) with DATAGROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATAGROUP SE has no effect on the direction of Sumitomo Rubber i.e., Sumitomo Rubber and DATAGROUP go up and down completely randomly.
Pair Corralation between Sumitomo Rubber and DATAGROUP
Assuming the 90 days horizon Sumitomo Rubber Industries is expected to generate 1.25 times more return on investment than DATAGROUP. However, Sumitomo Rubber is 1.25 times more volatile than DATAGROUP SE. It trades about 0.02 of its potential returns per unit of risk. DATAGROUP SE is currently generating about -0.03 per unit of risk. If you would invest 1,000.00 in Sumitomo Rubber Industries on September 2, 2024 and sell it today you would earn a total of 10.00 from holding Sumitomo Rubber Industries or generate 1.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sumitomo Rubber Industries vs. DATAGROUP SE
Performance |
| Timeline |
| Sumitomo Rubber Indu |
| DATAGROUP SE |
Sumitomo Rubber and DATAGROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumitomo Rubber and DATAGROUP
The main advantage of trading using opposite Sumitomo Rubber and DATAGROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumitomo Rubber position performs unexpectedly, DATAGROUP 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 DATAGROUP will offset losses from the drop in DATAGROUP's long position.| Sumitomo Rubber vs. Bridgestone | Sumitomo Rubber vs. The Goodyear Tire | Sumitomo Rubber vs. Zeon Corporation |
| DATAGROUP vs. Superior Plus Corp | DATAGROUP vs. NMI Holdings | DATAGROUP vs. Origin Agritech | DATAGROUP vs. SIVERS SEMICONDUCTORS AB |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |