Correlation Between Sunshine Agri and Champion Gaming
Can any of the company-specific risk be diversified away by investing in both Sunshine Agri and Champion Gaming 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 Sunshine Agri and Champion Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunshine Agri Tech and Champion Gaming Group, you can compare the effects of market volatilities on Sunshine Agri and Champion Gaming 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 Sunshine Agri with a short position of Champion Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunshine Agri and Champion Gaming.
Diversification Opportunities for Sunshine Agri and Champion Gaming
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Sunshine and Champion is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Sunshine Agri Tech and Champion Gaming Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Champion Gaming Group and Sunshine Agri 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 Sunshine Agri Tech are associated (or correlated) with Champion Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Champion Gaming Group has no effect on the direction of Sunshine Agri i.e., Sunshine Agri and Champion Gaming go up and down completely randomly.
Pair Corralation between Sunshine Agri and Champion Gaming
Assuming the 90 days trading horizon Sunshine Agri Tech is expected to generate 1.86 times more return on investment than Champion Gaming. However, Sunshine Agri is 1.86 times more volatile than Champion Gaming Group. It trades about 0.08 of its potential returns per unit of risk. Champion Gaming Group is currently generating about 0.01 per unit of risk. If you would invest 1.00 in Sunshine Agri Tech on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Sunshine Agri Tech or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunshine Agri Tech vs. Champion Gaming Group
Performance |
| Timeline |
| Sunshine Agri Tech |
| Champion Gaming Group |
Sunshine Agri and Champion Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunshine Agri and Champion Gaming
The main advantage of trading using opposite Sunshine Agri and Champion Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunshine Agri position performs unexpectedly, Champion Gaming 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 Champion Gaming will offset losses from the drop in Champion Gaming's long position.| Sunshine Agri vs. Champion Gaming Group | Sunshine Agri vs. Nova Leap Health | Sunshine Agri vs. Contagious Gaming | Sunshine Agri vs. WELL Health Technologies |
| Champion Gaming vs. Telus Corp | Champion Gaming vs. Toronto Dominion Bank | Champion Gaming vs. TC Energy Corp | Champion Gaming vs. Manulife Financial Corp |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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