Correlation Between Sun Life and Tidewater Midstream
Can any of the company-specific risk be diversified away by investing in both Sun Life and Tidewater Midstream 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 Tidewater Midstream 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 Tidewater Midstream and, you can compare the effects of market volatilities on Sun Life and Tidewater Midstream 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 Tidewater Midstream. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and Tidewater Midstream.
Diversification Opportunities for Sun Life and Tidewater Midstream
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sun and Tidewater is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and Tidewater Midstream and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tidewater Midstream and 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 Tidewater Midstream. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tidewater Midstream and has no effect on the direction of Sun Life i.e., Sun Life and Tidewater Midstream go up and down completely randomly.
Pair Corralation between Sun Life and Tidewater Midstream
Considering the 90-day investment horizon Sun Life Financial is expected to generate 0.21 times more return on investment than Tidewater Midstream. However, Sun Life Financial is 4.82 times less risky than Tidewater Midstream. It trades about 0.05 of its potential returns per unit of risk. Tidewater Midstream and is currently generating about -0.04 per unit of risk. If you would invest 4,706 in Sun Life Financial on November 2, 2024 and sell it today you would earn a total of 1,096 from holding Sun Life Financial or generate 23.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 96.56% |
| Values | Daily Returns |
Sun Life Financial vs. Tidewater Midstream and
Performance |
| Timeline |
| Sun Life Financial |
| Tidewater Midstream and |
Sun Life and Tidewater Midstream Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Life and Tidewater Midstream
The main advantage of trading using opposite Sun Life and Tidewater Midstream positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Life position performs unexpectedly, Tidewater Midstream 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 Tidewater Midstream will offset losses from the drop in Tidewater Midstream'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 |
| Tidewater Midstream vs. Dynagas LNG Partners | Tidewater Midstream vs. Martin Midstream Partners | Tidewater Midstream vs. Kinetik Holdings | Tidewater Midstream vs. GasLog Partners LP |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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