Correlation Between Sun Life and Ur Energy
Can any of the company-specific risk be diversified away by investing in both Sun Life and Ur Energy 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 Ur Energy 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 Ur Energy, you can compare the effects of market volatilities on Sun Life and Ur Energy 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 Ur Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and Ur Energy.
Diversification Opportunities for Sun Life and Ur Energy
Excellent diversification
The 3 months correlation between Sun and URE is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and Ur Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ur Energy 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 Ur Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ur Energy has no effect on the direction of Sun Life i.e., Sun Life and Ur Energy go up and down completely randomly.
Pair Corralation between Sun Life and Ur Energy
Assuming the 90 days trading horizon Sun Life is expected to generate 3.04 times less return on investment than Ur Energy. But when comparing it to its historical volatility, Sun Life Financial is 4.98 times less risky than Ur Energy. It trades about 0.22 of its potential returns per unit of risk. Ur Energy is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 164.00 in Ur Energy on September 12, 2024 and sell it today you would earn a total of 14.00 from holding Ur Energy or generate 8.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Life Financial vs. Ur Energy
Performance |
| Timeline |
| Sun Life Financial |
| Ur Energy |
Sun Life and Ur Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Life and Ur Energy
The main advantage of trading using opposite Sun Life and Ur Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, Ur Energy 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 Ur Energy will offset losses from the drop in Ur Energy's long position.| Sun Life vs. Sun Life Non | Sun Life vs. Sun Life Financial | Sun Life vs. Solar Alliance Energy | Sun Life vs. EcoSynthetix |
| Ur Energy vs. Denison Mines Corp | Ur Energy vs. Energy Fuels | Ur Energy vs. Laramide Resources | Ur Energy vs. Mega Uranium |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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