Correlation Between ASTRA INTERNATIONAL and Sun Life
Can any of the company-specific risk be diversified away by investing in both ASTRA INTERNATIONAL and Sun Life 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 ASTRA INTERNATIONAL and Sun Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASTRA INTERNATIONAL and Sun Life Financial, you can compare the effects of market volatilities on ASTRA INTERNATIONAL and Sun Life 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 ASTRA INTERNATIONAL with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTRA INTERNATIONAL and Sun Life.
Diversification Opportunities for ASTRA INTERNATIONAL and Sun Life
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ASTRA and Sun is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding ASTRA INTERNATIONAL and Sun Life Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Life Financial and ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL are associated (or correlated) with Sun Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Life Financial has no effect on the direction of ASTRA INTERNATIONAL i.e., ASTRA INTERNATIONAL and Sun Life go up and down completely randomly.
Pair Corralation between ASTRA INTERNATIONAL and Sun Life
Assuming the 90 days trading horizon ASTRA INTERNATIONAL is expected to generate 1.16 times less return on investment than Sun Life. In addition to that, ASTRA INTERNATIONAL is 4.11 times more volatile than Sun Life Financial. It trades about 0.01 of its total potential returns per unit of risk. Sun Life Financial is currently generating about 0.07 per unit of volatility. If you would invest 4,125 in Sun Life Financial on September 1, 2024 and sell it today you would earn a total of 1,625 from holding Sun Life Financial or generate 39.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASTRA INTERNATIONAL vs. Sun Life Financial
Performance |
| Timeline |
| ASTRA INTERNATIONAL |
| Sun Life Financial |
ASTRA INTERNATIONAL and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASTRA INTERNATIONAL and Sun Life
The main advantage of trading using opposite ASTRA INTERNATIONAL and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTRA INTERNATIONAL position performs unexpectedly, Sun Life 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 Sun Life will offset losses from the drop in Sun Life's long position.| ASTRA INTERNATIONAL vs. Boiron SA | ASTRA INTERNATIONAL vs. UNIVMUSIC GRPADR050 | ASTRA INTERNATIONAL vs. CECO ENVIRONMENTAL | ASTRA INTERNATIONAL vs. Insteel Industries |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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