Correlation Between Great Computer and Sunnic Technology
Can any of the company-specific risk be diversified away by investing in both Great Computer and Sunnic Technology 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 Great Computer and Sunnic Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great Computer and Sunnic Technology Merchandise, you can compare the effects of market volatilities on Great Computer and Sunnic Technology 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 Great Computer with a short position of Sunnic Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great Computer and Sunnic Technology.
Diversification Opportunities for Great Computer and Sunnic Technology
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Great and Sunnic is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Great Computer and Sunnic Technology Merchandise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunnic Technology and Great Computer 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 Great Computer are associated (or correlated) with Sunnic Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunnic Technology has no effect on the direction of Great Computer i.e., Great Computer and Sunnic Technology go up and down completely randomly.
Pair Corralation between Great Computer and Sunnic Technology
Assuming the 90 days trading horizon Great Computer is expected to generate 18.02 times more return on investment than Sunnic Technology. However, Great Computer is 18.02 times more volatile than Sunnic Technology Merchandise. It trades about 0.05 of its potential returns per unit of risk. Sunnic Technology Merchandise is currently generating about 0.03 per unit of risk. If you would invest 1,200 in Great Computer on September 1, 2024 and sell it today you would earn a total of 800.00 from holding Great Computer or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great Computer vs. Sunnic Technology Merchandise
Performance |
| Timeline |
| Great Computer |
| Sunnic Technology |
Great Computer and Sunnic Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great Computer and Sunnic Technology
The main advantage of trading using opposite Great Computer and Sunnic Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great Computer position performs unexpectedly, Sunnic Technology 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 Sunnic Technology will offset losses from the drop in Sunnic Technology's long position.| Great Computer vs. Chi Hua Fitness | Great Computer vs. CHC Healthcare Group | Great Computer vs. First Hotel Co | Great Computer vs. SS Healthcare Holding |
| Sunnic Technology vs. Chinese Maritime Transport | Sunnic Technology vs. Shan Loong Transportation Co | Sunnic Technology vs. WinMate Communication INC | Sunnic Technology vs. ESUN Financial Holding |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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