Correlation Between Sunny Friend and Launch Technologies
Can any of the company-specific risk be diversified away by investing in both Sunny Friend and Launch Technologies 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 Launch Technologies 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 Launch Technologies Co, you can compare the effects of market volatilities on Sunny Friend and Launch Technologies 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 Launch Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Friend and Launch Technologies.
Diversification Opportunities for Sunny Friend and Launch Technologies
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sunny and Launch is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Friend Environmental and Launch Technologies Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Launch Technologies 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 Launch Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Launch Technologies has no effect on the direction of Sunny Friend i.e., Sunny Friend and Launch Technologies go up and down completely randomly.
Pair Corralation between Sunny Friend and Launch Technologies
Assuming the 90 days trading horizon Sunny Friend Environmental is expected to under-perform the Launch Technologies. In addition to that, Sunny Friend is 4.06 times more volatile than Launch Technologies Co. It trades about -0.1 of its total potential returns per unit of risk. Launch Technologies Co is currently generating about -0.26 per unit of volatility. If you would invest 4,170 in Launch Technologies Co on August 30, 2024 and sell it today you would lose (110.00) from holding Launch Technologies Co or give up 2.64% 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. Launch Technologies Co
Performance |
| Timeline |
| Sunny Friend Environ |
| Launch Technologies |
Sunny Friend and Launch Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Friend and Launch Technologies
The main advantage of trading using opposite Sunny Friend and Launch Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Friend position performs unexpectedly, Launch Technologies 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 Launch Technologies will offset losses from the drop in Launch Technologies' long position.| Sunny Friend vs. Cleanaway Co | Sunny Friend vs. Taiwan Secom Co | Sunny Friend vs. ECOVE Environment Corp | Sunny Friend vs. TTET Union Corp |
| Launch Technologies vs. Univacco Technology | Launch Technologies vs. Integrated Service Technology | Launch Technologies vs. Microtips Technology | Launch Technologies vs. Arbor 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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