Correlation Between Sunrise New and Alfen NV
Can any of the company-specific risk be diversified away by investing in both Sunrise New and Alfen NV 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 Sunrise New and Alfen NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunrise New Energy and Alfen NV, you can compare the effects of market volatilities on Sunrise New and Alfen NV 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 Sunrise New with a short position of Alfen NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunrise New and Alfen NV.
Diversification Opportunities for Sunrise New and Alfen NV
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sunrise and Alfen is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sunrise New Energy and Alfen NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfen NV and Sunrise New 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 Sunrise New Energy are associated (or correlated) with Alfen NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfen NV has no effect on the direction of Sunrise New i.e., Sunrise New and Alfen NV go up and down completely randomly.
Pair Corralation between Sunrise New and Alfen NV
Given the investment horizon of 90 days Sunrise New Energy is expected to generate 1.52 times more return on investment than Alfen NV. However, Sunrise New is 1.52 times more volatile than Alfen NV. It trades about 0.08 of its potential returns per unit of risk. Alfen NV is currently generating about -0.13 per unit of risk. If you would invest 72.00 in Sunrise New Energy on August 31, 2024 and sell it today you would earn a total of 34.00 from holding Sunrise New Energy or generate 47.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Sunrise New Energy vs. Alfen NV
Performance |
| Timeline |
| Sunrise New Energy |
| Alfen NV |
Sunrise New and Alfen NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunrise New and Alfen NV
The main advantage of trading using opposite Sunrise New and Alfen NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunrise New position performs unexpectedly, Alfen NV 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 Alfen NV will offset losses from the drop in Alfen NV's long position.| Sunrise New vs. Espey Mfg Electronics | Sunrise New vs. NeoVolta Warrant | Sunrise New vs. Kimball Electronics | Sunrise New vs. Hayward Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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