Correlation Between Sumitomo Electric and Getty Images
Can any of the company-specific risk be diversified away by investing in both Sumitomo Electric and Getty Images 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 Sumitomo Electric and Getty Images into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumitomo Electric Industries and Getty Images Holdings, you can compare the effects of market volatilities on Sumitomo Electric and Getty Images 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 Sumitomo Electric with a short position of Getty Images. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumitomo Electric and Getty Images.
Diversification Opportunities for Sumitomo Electric and Getty Images
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sumitomo and Getty is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sumitomo Electric Industries and Getty Images Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Images Holdings and Sumitomo Electric 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 Sumitomo Electric Industries are associated (or correlated) with Getty Images. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Images Holdings has no effect on the direction of Sumitomo Electric i.e., Sumitomo Electric and Getty Images go up and down completely randomly.
Pair Corralation between Sumitomo Electric and Getty Images
If you would invest 1,657 in Sumitomo Electric Industries on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Sumitomo Electric Industries or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sumitomo Electric Industries vs. Getty Images Holdings
Performance |
| Timeline |
| Sumitomo Electric |
| Getty Images Holdings |
Sumitomo Electric and Getty Images Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumitomo Electric and Getty Images
The main advantage of trading using opposite Sumitomo Electric and Getty Images positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumitomo Electric position performs unexpectedly, Getty Images 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 Getty Images will offset losses from the drop in Getty Images' long position.| Sumitomo Electric vs. Analog Devices | Sumitomo Electric vs. Microchip Technology | Sumitomo Electric vs. IPG Photonics | Sumitomo Electric vs. Marti Technologies |
| Getty Images vs. Twilio Inc | Getty Images vs. Baidu Inc | Getty Images vs. Snap Inc | Getty Images vs. ANGI Homeservices |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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