Correlation Between Western Copper and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both Western Copper 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 Western Copper and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Copper and and Sunny Optical Technology, you can compare the effects of market volatilities on Western Copper 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 Western Copper with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Copper and Sunny Optical.
Diversification Opportunities for Western Copper and Sunny Optical
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Sunny is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Western Copper and 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 Western Copper 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 Western Copper and 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 Western Copper i.e., Western Copper and Sunny Optical go up and down completely randomly.
Pair Corralation between Western Copper and Sunny Optical
Assuming the 90 days trading horizon Western Copper and is expected to under-perform the Sunny Optical. But the stock apears to be less risky and, when comparing its historical volatility, Western Copper and is 1.15 times less risky than Sunny Optical. The stock trades about 0.0 of its potential returns per unit of risk. The Sunny Optical Technology is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 860.00 in Sunny Optical Technology on September 23, 2024 and sell it today you would earn a total of 10.00 from holding Sunny Optical Technology or generate 1.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Copper and vs. Sunny Optical Technology
Performance |
| Timeline |
| Western Copper |
| Sunny Optical Technology |
Western Copper and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Copper and Sunny Optical
The main advantage of trading using opposite Western Copper and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Copper 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.| Western Copper vs. BHP Group Limited | Western Copper vs. BHP Group Limited | Western Copper vs. Rio Tinto Group | Western Copper vs. Rio Tinto Group |
| Sunny Optical vs. Amphenol | Sunny Optical vs. Hon Hai Precision | Sunny Optical vs. Samsung SDI Co | Sunny Optical vs. Murata Manufacturing 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |