Correlation Between Aegon NV and SunOpta
Can any of the company-specific risk be diversified away by investing in both Aegon NV and SunOpta 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 Aegon NV and SunOpta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aegon NV ADR and SunOpta, you can compare the effects of market volatilities on Aegon NV and SunOpta 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 Aegon NV with a short position of SunOpta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aegon NV and SunOpta.
Diversification Opportunities for Aegon NV and SunOpta
Weak diversification
The 3 months correlation between Aegon and SunOpta is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Aegon NV ADR and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta and Aegon NV 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 Aegon NV ADR are associated (or correlated) with SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of Aegon NV i.e., Aegon NV and SunOpta go up and down completely randomly.
Pair Corralation between Aegon NV and SunOpta
Considering the 90-day investment horizon Aegon NV ADR is expected to under-perform the SunOpta. But the stock apears to be less risky and, when comparing its historical volatility, Aegon NV ADR is 2.26 times less risky than SunOpta. The stock trades about -0.03 of its potential returns per unit of risk. The SunOpta is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 597.00 in SunOpta on August 30, 2024 and sell it today you would earn a total of 182.00 from holding SunOpta or generate 30.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Aegon NV ADR vs. SunOpta
Performance |
| Timeline |
| Aegon NV ADR |
| SunOpta |
Aegon NV and SunOpta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aegon NV and SunOpta
The main advantage of trading using opposite Aegon NV and SunOpta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aegon NV position performs unexpectedly, SunOpta 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 SunOpta will offset losses from the drop in SunOpta's long position.| Aegon NV vs. Hartford Financial Services | Aegon NV vs. Goosehead Insurance | Aegon NV vs. International General Insurance | Aegon NV vs. Enstar Group Limited |
| SunOpta vs. Seneca Foods Corp | SunOpta vs. Central Garden Pet | SunOpta vs. Central Garden Pet | SunOpta vs. Natures Sunshine Products |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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