Correlation Between Sun Life and TOWNSQUARE MEDIA
Can any of the company-specific risk be diversified away by investing in both Sun Life and TOWNSQUARE MEDIA 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 Sun Life and TOWNSQUARE MEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Life Financial and TOWNSQUARE MEDIA INC, you can compare the effects of market volatilities on Sun Life and TOWNSQUARE MEDIA 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 Sun Life with a short position of TOWNSQUARE MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and TOWNSQUARE MEDIA.
Diversification Opportunities for Sun Life and TOWNSQUARE MEDIA
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sun and TOWNSQUARE is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and TOWNSQUARE MEDIA INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOWNSQUARE MEDIA INC and Sun Life 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 Sun Life Financial are associated (or correlated) with TOWNSQUARE MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOWNSQUARE MEDIA INC has no effect on the direction of Sun Life i.e., Sun Life and TOWNSQUARE MEDIA go up and down completely randomly.
Pair Corralation between Sun Life and TOWNSQUARE MEDIA
Assuming the 90 days horizon Sun Life Financial is expected to generate 0.25 times more return on investment than TOWNSQUARE MEDIA. However, Sun Life Financial is 4.08 times less risky than TOWNSQUARE MEDIA. It trades about -0.17 of its potential returns per unit of risk. TOWNSQUARE MEDIA INC is currently generating about -0.06 per unit of risk. If you would invest 5,750 in Sun Life Financial on October 12, 2024 and sell it today you would lose (100.00) from holding Sun Life Financial or give up 1.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Sun Life Financial vs. TOWNSQUARE MEDIA INC
Performance |
| Timeline |
| Sun Life Financial |
| TOWNSQUARE MEDIA INC |
Sun Life and TOWNSQUARE MEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Life and TOWNSQUARE MEDIA
The main advantage of trading using opposite Sun Life and TOWNSQUARE MEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, TOWNSQUARE MEDIA 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 TOWNSQUARE MEDIA will offset losses from the drop in TOWNSQUARE MEDIA's long position.| Sun Life vs. QINGCI GAMES INC | Sun Life vs. Scientific Games | Sun Life vs. International Game Technology | Sun Life vs. GAMING FAC SA |
| TOWNSQUARE MEDIA vs. American Eagle Outfitters | TOWNSQUARE MEDIA vs. Sun Life Financial | TOWNSQUARE MEDIA vs. REVO INSURANCE SPA | TOWNSQUARE MEDIA vs. UNIQA INSURANCE GR |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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