Correlation Between Suny Cellular and RSL Electronics
Can any of the company-specific risk be diversified away by investing in both Suny Cellular and RSL Electronics 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 Suny Cellular and RSL Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Suny Cellular Communication and RSL Electronics, you can compare the effects of market volatilities on Suny Cellular and RSL Electronics 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 Suny Cellular with a short position of RSL Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suny Cellular and RSL Electronics.
Diversification Opportunities for Suny Cellular and RSL Electronics
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Suny and RSL is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Suny Cellular Communication and RSL Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RSL Electronics and Suny Cellular 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 Suny Cellular Communication are associated (or correlated) with RSL Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RSL Electronics has no effect on the direction of Suny Cellular i.e., Suny Cellular and RSL Electronics go up and down completely randomly.
Pair Corralation between Suny Cellular and RSL Electronics
Assuming the 90 days trading horizon Suny Cellular Communication is expected to generate 0.95 times more return on investment than RSL Electronics. However, Suny Cellular Communication is 1.06 times less risky than RSL Electronics. It trades about 0.23 of its potential returns per unit of risk. RSL Electronics is currently generating about 0.17 per unit of risk. If you would invest 10,510 in Suny Cellular Communication on September 1, 2024 and sell it today you would earn a total of 1,190 from holding Suny Cellular Communication or generate 11.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suny Cellular Communication vs. RSL Electronics
Performance |
| Timeline |
| Suny Cellular Commun |
| RSL Electronics |
Suny Cellular and RSL Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suny Cellular and RSL Electronics
The main advantage of trading using opposite Suny Cellular and RSL Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suny Cellular position performs unexpectedly, RSL Electronics 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 RSL Electronics will offset losses from the drop in RSL Electronics' long position.| Suny Cellular vs. Palram | Suny Cellular vs. Shagrir Group Vehicle | Suny Cellular vs. EN Shoham Business | Suny Cellular vs. Lapidoth |
| RSL Electronics vs. Arad | RSL Electronics vs. Alony Hetz Properties | RSL Electronics vs. Airport City | RSL Electronics vs. Harel Insurance Investments |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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