Correlation Between Sun Life and First Republic
Can any of the company-specific risk be diversified away by investing in both Sun Life and First Republic 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 First Republic 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 First Republic Bank, you can compare the effects of market volatilities on Sun Life and First Republic 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 First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and First Republic.
Diversification Opportunities for Sun Life and First Republic
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sun and First is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank 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 First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of Sun Life i.e., Sun Life and First Republic go up and down completely randomly.
Pair Corralation between Sun Life and First Republic
If you would invest 5,625 in Sun Life Financial on August 30, 2024 and sell it today you would earn a total of 467.00 from holding Sun Life Financial or generate 8.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Sun Life Financial vs. First Republic Bank
Performance |
| Timeline |
| Sun Life Financial |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sun Life and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Life and First Republic
The main advantage of trading using opposite Sun Life and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, First Republic 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 First Republic will offset losses from the drop in First Republic's long position.| Sun Life vs. Axa Equitable Holdings | Sun Life vs. American International Group | Sun Life vs. Arch Capital Group | Sun Life vs. Old Republic International |
| First Republic vs. Trupanion | First Republic vs. Kinsale Capital Group | First Republic vs. Old Republic International | First Republic vs. Figs Inc |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |