Correlation Between Sun Life and DoubleDragon Properties
Can any of the company-specific risk be diversified away by investing in both Sun Life and DoubleDragon Properties 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 DoubleDragon Properties 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 DoubleDragon Properties Corp, you can compare the effects of market volatilities on Sun Life and DoubleDragon Properties 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 DoubleDragon Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and DoubleDragon Properties.
Diversification Opportunities for Sun Life and DoubleDragon Properties
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sun and DoubleDragon is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and DoubleDragon Properties Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DoubleDragon Properties 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 DoubleDragon Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DoubleDragon Properties has no effect on the direction of Sun Life i.e., Sun Life and DoubleDragon Properties go up and down completely randomly.
Pair Corralation between Sun Life and DoubleDragon Properties
Assuming the 90 days trading horizon Sun Life Financial is expected to generate 4.82 times more return on investment than DoubleDragon Properties. However, Sun Life is 4.82 times more volatile than DoubleDragon Properties Corp. It trades about 0.06 of its potential returns per unit of risk. DoubleDragon Properties Corp is currently generating about 0.06 per unit of risk. If you would invest 262,495 in Sun Life Financial on August 25, 2024 and sell it today you would earn a total of 77,505 from holding Sun Life Financial or generate 29.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 83.86% |
| Values | Daily Returns |
Sun Life Financial vs. DoubleDragon Properties Corp
Performance |
| Timeline |
| Sun Life Financial |
| DoubleDragon Properties |
Sun Life and DoubleDragon Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Life and DoubleDragon Properties
The main advantage of trading using opposite Sun Life and DoubleDragon Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, DoubleDragon Properties 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 DoubleDragon Properties will offset losses from the drop in DoubleDragon Properties' long position.| Sun Life vs. Manulife Financial Corp | Sun Life vs. National Reinsurance | Sun Life vs. Allhome Corp | Sun Life vs. Jollibee Foods Corp |
| DoubleDragon Properties vs. Asia United Bank | DoubleDragon Properties vs. Sun Life Financial | DoubleDragon Properties vs. Converge Information Communications | DoubleDragon Properties vs. Union 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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