Correlation Between Eastinco Mining and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both Eastinco Mining 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 Eastinco Mining and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastinco Mining Exploration and Sunny Optical Technology, you can compare the effects of market volatilities on Eastinco Mining 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 Eastinco Mining with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastinco Mining and Sunny Optical.
Diversification Opportunities for Eastinco Mining and Sunny Optical
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eastinco and Sunny is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Eastinco Mining Exploration 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 Eastinco Mining 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 Eastinco Mining Exploration 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 Eastinco Mining i.e., Eastinco Mining and Sunny Optical go up and down completely randomly.
Pair Corralation between Eastinco Mining and Sunny Optical
Assuming the 90 days trading horizon Eastinco Mining Exploration is expected to generate 0.7 times more return on investment than Sunny Optical. However, Eastinco Mining Exploration is 1.43 times less risky than Sunny Optical. It trades about 0.29 of its potential returns per unit of risk. Sunny Optical Technology is currently generating about 0.02 per unit of risk. If you would invest 4,650 in Eastinco Mining Exploration on October 30, 2024 and sell it today you would earn a total of 750.00 from holding Eastinco Mining Exploration or generate 16.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastinco Mining Exploration vs. Sunny Optical Technology
Performance |
| Timeline |
| Eastinco Mining Expl |
| Sunny Optical Technology |
Eastinco Mining and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastinco Mining and Sunny Optical
The main advantage of trading using opposite Eastinco Mining and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastinco Mining 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.| Eastinco Mining vs. Hollywood Bowl Group | Eastinco Mining vs. Molson Coors Beverage | Eastinco Mining vs. Zinc Media Group | Eastinco Mining vs. Ebro Foods |
| Sunny Optical vs. Young Cos Brewery | Sunny Optical vs. Griffin Mining | Sunny Optical vs. Beowulf Mining | Sunny Optical vs. Fevertree Drinks Plc |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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