Correlation Between Sunny Friend and Advanced Wireless
Can any of the company-specific risk be diversified away by investing in both Sunny Friend and Advanced Wireless 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 Sunny Friend and Advanced Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunny Friend Environmental and Advanced Wireless Semiconductor, you can compare the effects of market volatilities on Sunny Friend and Advanced Wireless 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 Sunny Friend with a short position of Advanced Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Friend and Advanced Wireless.
Diversification Opportunities for Sunny Friend and Advanced Wireless
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sunny and Advanced is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Friend Environmental and Advanced Wireless Semiconducto in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Wireless and Sunny Friend 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 Sunny Friend Environmental are associated (or correlated) with Advanced Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Wireless has no effect on the direction of Sunny Friend i.e., Sunny Friend and Advanced Wireless go up and down completely randomly.
Pair Corralation between Sunny Friend and Advanced Wireless
Assuming the 90 days trading horizon Sunny Friend Environmental is expected to generate 0.66 times more return on investment than Advanced Wireless. However, Sunny Friend Environmental is 1.51 times less risky than Advanced Wireless. It trades about -0.02 of its potential returns per unit of risk. Advanced Wireless Semiconductor is currently generating about -0.05 per unit of risk. If you would invest 9,630 in Sunny Friend Environmental on September 1, 2024 and sell it today you would lose (620.00) from holding Sunny Friend Environmental or give up 6.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunny Friend Environmental vs. Advanced Wireless Semiconducto
Performance |
| Timeline |
| Sunny Friend Environ |
| Advanced Wireless |
Sunny Friend and Advanced Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Friend and Advanced Wireless
The main advantage of trading using opposite Sunny Friend and Advanced Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Friend position performs unexpectedly, Advanced Wireless 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 Advanced Wireless will offset losses from the drop in Advanced Wireless' long position.| Sunny Friend vs. Cleanaway Co | Sunny Friend vs. Taiwan Secom Co | Sunny Friend vs. TTET Union Corp | Sunny Friend vs. Tehmag Foods |
| Advanced Wireless vs. WIN Semiconductors | Advanced Wireless vs. Visual Photonics Epitaxy | Advanced Wireless vs. GlobalWafers Co | Advanced Wireless vs. Unimicron Technology Corp |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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