Correlation Between QUEEN S and Sun Life
Can any of the company-specific risk be diversified away by investing in both QUEEN S and Sun Life 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 QUEEN S and Sun Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between QUEEN S ROAD and Sun Life Financial, you can compare the effects of market volatilities on QUEEN S and Sun Life 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 QUEEN S with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of QUEEN S and Sun Life.
Diversification Opportunities for QUEEN S and Sun Life
Good diversification
The 3 months correlation between QUEEN and Sun is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding QUEEN S ROAD and Sun Life Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Life Financial and QUEEN S 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 QUEEN S ROAD are associated (or correlated) with Sun Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Life Financial has no effect on the direction of QUEEN S i.e., QUEEN S and Sun Life go up and down completely randomly.
Pair Corralation between QUEEN S and Sun Life
Assuming the 90 days horizon QUEEN S ROAD is expected to under-perform the Sun Life. In addition to that, QUEEN S is 4.62 times more volatile than Sun Life Financial. It trades about -0.04 of its total potential returns per unit of risk. Sun Life Financial is currently generating about -0.12 per unit of volatility. If you would invest 5,800 in Sun Life Financial on October 30, 2024 and sell it today you would lose (250.00) from holding Sun Life Financial or give up 4.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
QUEEN S ROAD vs. Sun Life Financial
Performance |
| Timeline |
| QUEEN S ROAD |
| Sun Life Financial |
QUEEN S and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QUEEN S and Sun Life
The main advantage of trading using opposite QUEEN S and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QUEEN S position performs unexpectedly, Sun Life 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 Sun Life will offset losses from the drop in Sun Life's long position.| QUEEN S vs. Blackstone Group | QUEEN S vs. The Bank of | QUEEN S vs. Ameriprise Financial | QUEEN S vs. State Street |
| Sun Life vs. GALENA MINING LTD | Sun Life vs. SILICON LABORATOR | Sun Life vs. Warner Music Group | Sun Life vs. Silicon Motion Technology |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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