Correlation Between Altair Engineering and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both Altair Engineering and Sunny Optical 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 Altair Engineering and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altair Engineering and Sunny Optical Technology, you can compare the effects of market volatilities on Altair Engineering and Sunny Optical 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 Altair Engineering with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altair Engineering and Sunny Optical.
Diversification Opportunities for Altair Engineering and Sunny Optical
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Altair and Sunny is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Altair Engineering and Sunny Optical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Optical Technology and Altair Engineering 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 Altair Engineering are associated (or correlated) with Sunny Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Optical Technology has no effect on the direction of Altair Engineering i.e., Altair Engineering and Sunny Optical go up and down completely randomly.
Pair Corralation between Altair Engineering and Sunny Optical
Assuming the 90 days horizon Altair Engineering is expected to generate 0.08 times more return on investment than Sunny Optical. However, Altair Engineering is 13.07 times less risky than Sunny Optical. It trades about 0.16 of its potential returns per unit of risk. Sunny Optical Technology is currently generating about -0.21 per unit of risk. If you would invest 10,200 in Altair Engineering on January 11, 2025 and sell it today you would earn a total of 100.00 from holding Altair Engineering or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 54.55% |
| Values | Daily Returns |
Altair Engineering vs. Sunny Optical Technology
Performance |
| Timeline |
| Altair Engineering |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Sunny Optical Technology |
Altair Engineering and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altair Engineering and Sunny Optical
The main advantage of trading using opposite Altair Engineering and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altair Engineering position performs unexpectedly, Sunny Optical 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 Sunny Optical will offset losses from the drop in Sunny Optical's long position.| Altair Engineering vs. Emperor Entertainment Hotel | Altair Engineering vs. Ubisoft Entertainment SA | Altair Engineering vs. Lifeway Foods | Altair Engineering vs. Nomad Foods |
| Sunny Optical vs. Zijin Mining Group | Sunny Optical vs. Tencent Music Entertainment | Sunny Optical vs. Harmony Gold Mining | Sunny Optical vs. FILL UP MEDIA |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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