Correlation Between Evolution Gaming and Sun Country
Can any of the company-specific risk be diversified away by investing in both Evolution Gaming 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 Evolution Gaming and Sun Country into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolution Gaming Group and Sun Country Airlines, you can compare the effects of market volatilities on Evolution Gaming 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 Evolution Gaming with a short position of Sun Country. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution Gaming and Sun Country.
Diversification Opportunities for Evolution Gaming and Sun Country
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Evolution and Sun is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Evolution Gaming Group 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 Evolution Gaming 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 Evolution Gaming Group 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 Evolution Gaming i.e., Evolution Gaming and Sun Country go up and down completely randomly.
Pair Corralation between Evolution Gaming and Sun Country
Assuming the 90 days horizon Evolution Gaming Group is expected to under-perform the Sun Country. But the pink sheet apears to be less risky and, when comparing its historical volatility, Evolution Gaming Group is 3.1 times less risky than Sun Country. The pink sheet trades about -0.17 of its potential returns per unit of risk. The Sun Country Airlines is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,258 in Sun Country Airlines on August 30, 2024 and sell it today you would earn a total of 184.00 from holding Sun Country Airlines or generate 14.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolution Gaming Group vs. Sun Country Airlines
Performance |
| Timeline |
| Evolution Gaming |
| Sun Country Airlines |
Evolution Gaming and Sun Country Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolution Gaming and Sun Country
The main advantage of trading using opposite Evolution Gaming and Sun Country positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolution Gaming 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.| Evolution Gaming vs. Galaxy Gaming | Evolution Gaming vs. Everi Holdings | Evolution Gaming vs. Intema Solutions | Evolution Gaming vs. 888 Holdings |
| Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. Copa Holdings SA | Sun Country vs. SkyWest |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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