Correlation Between DAX Index and Sun Life
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By analyzing existing cross correlation between DAX Index and Sun Life Financial, you can compare the effects of market volatilities on DAX Index and Sun Life 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 DAX Index with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and Sun Life.
Diversification Opportunities for DAX Index and Sun Life
Very weak diversification
The 3 months correlation between DAX and Sun is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and Sun Life Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Life Financial and DAX Index 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 DAX Index are associated (or correlated) with Sun Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Life Financial has no effect on the direction of DAX Index i.e., DAX Index and Sun Life go up and down completely randomly.
Pair Corralation between DAX Index and Sun Life
Assuming the 90 days trading horizon DAX Index is expected to generate 6.11 times less return on investment than Sun Life. But when comparing it to its historical volatility, DAX Index is 1.33 times less risky than Sun Life. It trades about 0.04 of its potential returns per unit of risk. Sun Life Financial is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 4,401 in Sun Life Financial on August 29, 2024 and sell it today you would earn a total of 1,349 from holding Sun Life Financial or generate 30.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. Sun Life Financial
Performance |
| Timeline |
DAX Index and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
Sun Life Financial
Pair trading matchups for Sun Life
Pair Trading with DAX Index and Sun Life
The main advantage of trading using opposite DAX Index and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, Sun Life 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 Life will offset losses from the drop in Sun Life's long position.| DAX Index vs. Gladstone Investment | DAX Index vs. REINET INVESTMENTS SCA | DAX Index vs. CarsalesCom | DAX Index vs. MARKET VECTR RETAIL |
| Sun Life vs. Pure Storage | Sun Life vs. Science Applications International | Sun Life vs. SBA Communications Corp | Sun Life vs. Public Storage |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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