Correlation Between Sun Life and GasLog

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Can any of the company-specific risk be diversified away by investing in both Sun Life and GasLog 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 GasLog 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 GasLog, you can compare the effects of market volatilities on Sun Life and GasLog 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 GasLog. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and GasLog.

Diversification Opportunities for Sun Life and GasLog

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Sun and GasLog is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and GasLog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GasLog 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 GasLog. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GasLog has no effect on the direction of Sun Life i.e., Sun Life and GasLog go up and down completely randomly.

Pair Corralation between Sun Life and GasLog

If you would invest  5,927  in Sun Life Financial on September 13, 2024 and sell it today you would earn a total of  142.50  from holding Sun Life Financial or generate 2.4% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Sun Life Financial  vs.  GasLog

 Performance 
       Timeline  
Sun Life Financial 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Sun Life Financial are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent essential indicators, Sun Life may actually be approaching a critical reversion point that can send shares even higher in January 2025.
GasLog 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days GasLog has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, GasLog is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Sun Life and GasLog Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Sun Life and GasLog

The main advantage of trading using opposite Sun Life and GasLog positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, GasLog 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 GasLog will offset losses from the drop in GasLog's long position.
The idea behind Sun Life Financial and GasLog pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.

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