Correlation Between Puregold Price and Sun Life
Can any of the company-specific risk be diversified away by investing in both Puregold Price and Sun Life 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 Puregold Price and Sun Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puregold Price Club and Sun Life Financial, you can compare the effects of market volatilities on Puregold Price 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 Puregold Price with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puregold Price and Sun Life.
Diversification Opportunities for Puregold Price and Sun Life
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Puregold and Sun is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Puregold Price Club 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 Puregold Price 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 Puregold Price Club 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 Puregold Price i.e., Puregold Price and Sun Life go up and down completely randomly.
Pair Corralation between Puregold Price and Sun Life
Assuming the 90 days trading horizon Puregold Price is expected to generate 8.82 times less return on investment than Sun Life. But when comparing it to its historical volatility, Puregold Price Club is 1.83 times less risky than Sun Life. It trades about 0.02 of its potential returns per unit of risk. Sun Life Financial is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 292,029 in Sun Life Financial on September 12, 2024 and sell it today you would earn a total of 65,971 from holding Sun Life Financial or generate 22.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.25% |
| Values | Daily Returns |
Puregold Price Club vs. Sun Life Financial
Performance |
| Timeline |
| Puregold Price Club |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Sun Life Financial |
Puregold Price and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puregold Price and Sun Life
The main advantage of trading using opposite Puregold Price and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puregold Price 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.| Puregold Price vs. National Reinsurance | Puregold Price vs. Asia United Bank | Puregold Price vs. Apex Mining Co | Puregold Price vs. Jollibee Foods Corp |
| Sun Life vs. Philippine Business Bank | Sun Life vs. Integrated Micro Electronics | Sun Life vs. BDO Unibank | Sun Life vs. Converge Information Communications |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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