Correlation Between Sun Race and Delta Electronics
Can any of the company-specific risk be diversified away by investing in both Sun Race and Delta Electronics 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 Sun Race and Delta Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Race Sturmey Archer and Delta Electronics, you can compare the effects of market volatilities on Sun Race and Delta Electronics 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 Sun Race with a short position of Delta Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Race and Delta Electronics.
Diversification Opportunities for Sun Race and Delta Electronics
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sun and Delta is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Sun Race Sturmey Archer and Delta Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Electronics and Sun Race 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 Sun Race Sturmey Archer are associated (or correlated) with Delta Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Electronics has no effect on the direction of Sun Race i.e., Sun Race and Delta Electronics go up and down completely randomly.
Pair Corralation between Sun Race and Delta Electronics
Assuming the 90 days trading horizon Sun Race Sturmey Archer is expected to under-perform the Delta Electronics. In addition to that, Sun Race is 1.17 times more volatile than Delta Electronics. It trades about -0.39 of its total potential returns per unit of risk. Delta Electronics is currently generating about -0.17 per unit of volatility. If you would invest 40,600 in Delta Electronics on August 30, 2024 and sell it today you would lose (2,000) from holding Delta Electronics or give up 4.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Race Sturmey Archer vs. Delta Electronics
Performance |
| Timeline |
| Sun Race Sturmey |
| Delta Electronics |
Sun Race and Delta Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Race and Delta Electronics
The main advantage of trading using opposite Sun Race and Delta Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Race position performs unexpectedly, Delta Electronics 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 Delta Electronics will offset losses from the drop in Delta Electronics' long position.| Sun Race vs. Lee Chi Enterprises | Sun Race vs. Basso Industry Corp | Sun Race vs. Giant Manufacturing Co | Sun Race vs. Merida Industry Co |
| Delta Electronics vs. Quanta Computer | Delta Electronics vs. Hon Hai Precision | Delta Electronics vs. United Microelectronics | Delta Electronics vs. LARGAN Precision Co |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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