Correlation Between Suntory Beverage and Lion One
Can any of the company-specific risk be diversified away by investing in both Suntory Beverage and Lion One 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 Suntory Beverage and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Suntory Beverage Food and Lion One Metals, you can compare the effects of market volatilities on Suntory Beverage and Lion One 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 Suntory Beverage with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suntory Beverage and Lion One.
Diversification Opportunities for Suntory Beverage and Lion One
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Suntory and Lion is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Suntory Beverage Food and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and Suntory Beverage 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 Suntory Beverage Food are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of Suntory Beverage i.e., Suntory Beverage and Lion One go up and down completely randomly.
Pair Corralation between Suntory Beverage and Lion One
Assuming the 90 days horizon Suntory Beverage Food is expected to generate 0.36 times more return on investment than Lion One. However, Suntory Beverage Food is 2.81 times less risky than Lion One. It trades about 0.01 of its potential returns per unit of risk. Lion One Metals is currently generating about -0.03 per unit of risk. If you would invest 3,196 in Suntory Beverage Food on September 3, 2024 and sell it today you would lose (62.00) from holding Suntory Beverage Food or give up 1.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suntory Beverage Food vs. Lion One Metals
Performance |
| Timeline |
| Suntory Beverage Food |
| Lion One Metals |
Suntory Beverage and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suntory Beverage and Lion One
The main advantage of trading using opposite Suntory Beverage and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suntory Beverage position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| Suntory Beverage vs. Sporttotal AG | Suntory Beverage vs. PARKEN Sport Entertainment | Suntory Beverage vs. USWE SPORTS AB | Suntory Beverage vs. EPSILON HEALTHCARE LTD |
| Lion One vs. Cars Inc | Lion One vs. Chunghwa Telecom Co | Lion One vs. United Internet AG | Lion One vs. JAPAN TOBACCO UNSPADR12 |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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