Correlation Between Advanced Medical and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both Advanced Medical 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 Advanced Medical and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Medical Solutions and Sunny Optical Technology, you can compare the effects of market volatilities on Advanced Medical 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 Advanced Medical with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Medical and Sunny Optical.
Diversification Opportunities for Advanced Medical and Sunny Optical
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Advanced and Sunny is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Medical Solutions 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 Advanced Medical 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 Advanced Medical Solutions 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 Advanced Medical i.e., Advanced Medical and Sunny Optical go up and down completely randomly.
Pair Corralation between Advanced Medical and Sunny Optical
Assuming the 90 days trading horizon Advanced Medical Solutions is expected to under-perform the Sunny Optical. But the stock apears to be less risky and, when comparing its historical volatility, Advanced Medical Solutions is 1.35 times less risky than Sunny Optical. The stock trades about -0.02 of its potential returns per unit of risk. The Sunny Optical Technology is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,925 in Sunny Optical Technology on September 21, 2024 and sell it today you would earn a total of 2,130 from holding Sunny Optical Technology or generate 43.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Medical Solutions vs. Sunny Optical Technology
Performance |
| Timeline |
| Advanced Medical Sol |
| Sunny Optical Technology |
Advanced Medical and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Medical and Sunny Optical
The main advantage of trading using opposite Advanced Medical and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Medical 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.| Advanced Medical vs. Quadrise Plc | Advanced Medical vs. ImmuPharma PLC | Advanced Medical vs. Intuitive Investments Group | Advanced Medical vs. European Metals Holdings |
| Sunny Optical vs. Wyndham Hotels Resorts | Sunny Optical vs. Advanced Medical Solutions | Sunny Optical vs. Intermediate Capital Group | Sunny Optical vs. Centaur 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |