Correlation Between Eldorado Gold and Sun Country
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Sun Country 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 Eldorado Gold and Sun Country into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eldorado Gold Corp and Sun Country Airlines, you can compare the effects of market volatilities on Eldorado Gold and Sun Country 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 Eldorado Gold with a short position of Sun Country. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Sun Country.
Diversification Opportunities for Eldorado Gold and Sun Country
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eldorado and Sun is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Sun Country Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Country Airlines and Eldorado Gold 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 Eldorado Gold Corp are associated (or correlated) with Sun Country. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Country Airlines has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Sun Country go up and down completely randomly.
Pair Corralation between Eldorado Gold and Sun Country
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Sun Country. But the stock apears to be less risky and, when comparing its historical volatility, Eldorado Gold Corp is 1.36 times less risky than Sun Country. The stock trades about -0.18 of its potential returns per unit of risk. The Sun Country Airlines is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,278 in Sun Country Airlines on August 31, 2024 and sell it today you would earn a total of 164.00 from holding Sun Country Airlines or generate 12.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eldorado Gold Corp vs. Sun Country Airlines
Performance |
| Timeline |
| Eldorado Gold Corp |
| Sun Country Airlines |
Eldorado Gold and Sun Country Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Sun Country
The main advantage of trading using opposite Eldorado Gold and Sun Country positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Sun Country 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 Country will offset losses from the drop in Sun Country's long position.| Eldorado Gold vs. Franco Nevada | Eldorado Gold vs. Alamos Gold | Eldorado Gold vs. Seabridge Gold | Eldorado Gold vs. Osisko Gold Ro |
| Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. SkyWest | Sun Country vs. Air Transport Services |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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