Correlation Between DXC Technology and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both DXC Technology 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 DXC Technology and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DXC Technology Co and Sunny Optical Technology, you can compare the effects of market volatilities on DXC Technology 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 DXC Technology with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and Sunny Optical.
Diversification Opportunities for DXC Technology and Sunny Optical
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DXC and Sunny is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co 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 DXC Technology 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 DXC Technology Co 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 DXC Technology i.e., DXC Technology and Sunny Optical go up and down completely randomly.
Pair Corralation between DXC Technology and Sunny Optical
Assuming the 90 days trading horizon DXC Technology is expected to generate 1.05 times less return on investment than Sunny Optical. But when comparing it to its historical volatility, DXC Technology Co is 1.36 times less risky than Sunny Optical. It trades about 0.0 of its potential returns per unit of risk. Sunny Optical Technology is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,012 in Sunny Optical Technology on September 4, 2024 and sell it today you would lose (259.00) from holding Sunny Optical Technology or give up 25.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
DXC Technology Co vs. Sunny Optical Technology
Performance |
| Timeline |
| DXC Technology |
| Sunny Optical Technology |
DXC Technology and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DXC Technology and Sunny Optical
The main advantage of trading using opposite DXC Technology and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology 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.| DXC Technology vs. Apple Inc | DXC Technology vs. Apple Inc | DXC Technology vs. Apple Inc | DXC Technology vs. Apple Inc |
| Sunny Optical vs. Hon Hai Precision | Sunny Optical vs. Samsung SDI Co | Sunny Optical vs. Murata Manufacturing Co | Sunny Optical vs. Mitsubishi Electric |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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