Correlation Between Stewart Information and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both Stewart Information 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 Stewart Information and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stewart Information Services and Sunny Optical Technology, you can compare the effects of market volatilities on Stewart Information 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 Stewart Information with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stewart Information and Sunny Optical.
Diversification Opportunities for Stewart Information and Sunny Optical
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Stewart and Sunny is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Stewart Information Services 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 Stewart Information 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 Stewart Information Services 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 Stewart Information i.e., Stewart Information and Sunny Optical go up and down completely randomly.
Pair Corralation between Stewart Information and Sunny Optical
Assuming the 90 days horizon Stewart Information Services is expected to generate 0.5 times more return on investment than Sunny Optical. However, Stewart Information Services is 2.0 times less risky than Sunny Optical. It trades about 0.1 of its potential returns per unit of risk. Sunny Optical Technology is currently generating about 0.01 per unit of risk. If you would invest 3,758 in Stewart Information Services on September 1, 2024 and sell it today you would earn a total of 3,142 from holding Stewart Information Services or generate 83.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stewart Information Services vs. Sunny Optical Technology
Performance |
| Timeline |
| Stewart Information |
| Sunny Optical Technology |
Stewart Information and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stewart Information and Sunny Optical
The main advantage of trading using opposite Stewart Information and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stewart Information 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.| Stewart Information vs. Singapore Telecommunications Limited | Stewart Information vs. Harmony Gold Mining | Stewart Information vs. Verizon Communications | Stewart Information vs. Chesapeake Utilities |
| Sunny Optical vs. Altair Engineering | Sunny Optical vs. MGIC INVESTMENT | Sunny Optical vs. PennyMac Mortgage Investment | Sunny Optical vs. REGAL ASIAN INVESTMENTS |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |