Correlation Between Sun Life and Ocumetics Technology
Can any of the company-specific risk be diversified away by investing in both Sun Life and Ocumetics Technology 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 Ocumetics Technology 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 Ocumetics Technology Corp, you can compare the effects of market volatilities on Sun Life and Ocumetics Technology 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 Ocumetics Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and Ocumetics Technology.
Diversification Opportunities for Sun Life and Ocumetics Technology
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sun and Ocumetics is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and Ocumetics Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocumetics Technology Corp 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 Ocumetics Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocumetics Technology Corp has no effect on the direction of Sun Life i.e., Sun Life and Ocumetics Technology go up and down completely randomly.
Pair Corralation between Sun Life and Ocumetics Technology
Assuming the 90 days trading horizon Sun Life Financial is expected to generate 0.19 times more return on investment than Ocumetics Technology. However, Sun Life Financial is 5.27 times less risky than Ocumetics Technology. It trades about 0.11 of its potential returns per unit of risk. Ocumetics Technology Corp is currently generating about 0.01 per unit of risk. If you would invest 1,693 in Sun Life Financial on September 14, 2024 and sell it today you would earn a total of 359.00 from holding Sun Life Financial or generate 21.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Sun Life Financial vs. Ocumetics Technology Corp
Performance |
| Timeline |
| Sun Life Financial |
| Ocumetics Technology Corp |
Sun Life and Ocumetics Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Life and Ocumetics Technology
The main advantage of trading using opposite Sun Life and Ocumetics Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, Ocumetics Technology 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 Ocumetics Technology will offset losses from the drop in Ocumetics Technology's long position.| Sun Life vs. Canlan Ice Sports | Sun Life vs. Precision Drilling | Sun Life vs. Nova Leap Health | Sun Life vs. NeuPath Health |
| Ocumetics Technology vs. JPMorgan Chase Co | Ocumetics Technology vs. Bank of America | Ocumetics Technology vs. Toronto Dominion Bank | Ocumetics Technology vs. Royal Bank of |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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