Correlation Between Sun Country and Afya
Can any of the company-specific risk be diversified away by investing in both Sun Country and Afya 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 Country and Afya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Country Airlines and Afya, you can compare the effects of market volatilities on Sun Country and Afya 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 Country with a short position of Afya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and Afya.
Diversification Opportunities for Sun Country and Afya
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sun and Afya is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and Afya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Afya and Sun Country 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 Country Airlines are associated (or correlated) with Afya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Afya has no effect on the direction of Sun Country i.e., Sun Country and Afya go up and down completely randomly.
Pair Corralation between Sun Country and Afya
Given the investment horizon of 90 days Sun Country Airlines is expected to generate 1.21 times more return on investment than Afya. However, Sun Country is 1.21 times more volatile than Afya. It trades about 0.34 of its potential returns per unit of risk. Afya is currently generating about 0.09 per unit of risk. If you would invest 1,453 in Sun Country Airlines on November 3, 2024 and sell it today you would earn a total of 243.00 from holding Sun Country Airlines or generate 16.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Country Airlines vs. Afya
Performance |
| Timeline |
| Sun Country Airlines |
| Afya |
Sun Country and Afya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and Afya
The main advantage of trading using opposite Sun Country and Afya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country position performs unexpectedly, Afya 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 Afya will offset losses from the drop in Afya's long position.| Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. Copa Holdings SA | Sun Country vs. SkyWest |
| Afya vs. Adtalem Global Education | Afya vs. Laureate Education | Afya vs. American Public Education | Afya vs. Strategic Education |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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