Correlation Between Sun Country and BrightSpring Health
Can any of the company-specific risk be diversified away by investing in both Sun Country and BrightSpring Health 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 BrightSpring Health 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 BrightSpring Health Services,, you can compare the effects of market volatilities on Sun Country and BrightSpring Health 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 BrightSpring Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and BrightSpring Health.
Diversification Opportunities for Sun Country and BrightSpring Health
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sun and BrightSpring is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and BrightSpring Health Services, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BrightSpring Health 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 BrightSpring Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BrightSpring Health has no effect on the direction of Sun Country i.e., Sun Country and BrightSpring Health go up and down completely randomly.
Pair Corralation between Sun Country and BrightSpring Health
Given the investment horizon of 90 days Sun Country is expected to generate 1.5 times less return on investment than BrightSpring Health. In addition to that, Sun Country is 1.21 times more volatile than BrightSpring Health Services,. It trades about 0.13 of its total potential returns per unit of risk. BrightSpring Health Services, is currently generating about 0.24 per unit of volatility. If you would invest 5,872 in BrightSpring Health Services, on August 29, 2024 and sell it today you would earn a total of 1,043 from holding BrightSpring Health Services, or generate 17.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Country Airlines vs. BrightSpring Health Services,
Performance |
| Timeline |
| Sun Country Airlines |
| BrightSpring Health |
Sun Country and BrightSpring Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and BrightSpring Health
The main advantage of trading using opposite Sun Country and BrightSpring Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country position performs unexpectedly, BrightSpring Health 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 BrightSpring Health will offset losses from the drop in BrightSpring Health's long position.| Sun Country vs. JetBlue Airways Corp | Sun Country vs. SkyWest | Sun Country vs. International Consolidated Airlines | Sun Country vs. Spirit Airlines |
| BrightSpring Health vs. JetBlue Airways Corp | BrightSpring Health vs. Sun Country Airlines | BrightSpring Health vs. Paysafe | BrightSpring Health vs. Usio Inc |
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 Stocks Directory module to find actively traded stocks across global markets.
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