Correlation Between FORWARD AIR and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both FORWARD AIR 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 FORWARD AIR and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FORWARD AIR P and Sunny Optical Technology, you can compare the effects of market volatilities on FORWARD AIR 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 FORWARD AIR with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORWARD AIR and Sunny Optical.
Diversification Opportunities for FORWARD AIR and Sunny Optical
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FORWARD and Sunny is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding FORWARD AIR P 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 FORWARD AIR 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 FORWARD AIR P 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 FORWARD AIR i.e., FORWARD AIR and Sunny Optical go up and down completely randomly.
Pair Corralation between FORWARD AIR and Sunny Optical
Assuming the 90 days horizon FORWARD AIR is expected to generate 1.39 times less return on investment than Sunny Optical. In addition to that, FORWARD AIR is 1.33 times more volatile than Sunny Optical Technology. It trades about 0.07 of its total potential returns per unit of risk. Sunny Optical Technology is currently generating about 0.13 per unit of volatility. If you would invest 506.00 in Sunny Optical Technology on October 26, 2024 and sell it today you would earn a total of 337.00 from holding Sunny Optical Technology or generate 66.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FORWARD AIR P vs. Sunny Optical Technology
Performance |
| Timeline |
| FORWARD AIR P |
| Sunny Optical Technology |
FORWARD AIR and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FORWARD AIR and Sunny Optical
The main advantage of trading using opposite FORWARD AIR and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FORWARD AIR 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.| FORWARD AIR vs. Safety Insurance Group | FORWARD AIR vs. Singapore Reinsurance | FORWARD AIR vs. QBE Insurance Group | FORWARD AIR vs. AWILCO DRILLING PLC |
| Sunny Optical vs. Hon Hai Precision | Sunny Optical vs. Samsung SDI Co | Sunny Optical vs. Corning Incorporated | Sunny Optical vs. Mitsubishi Electric |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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