Correlation Between Sun Country and Chemtrade Logistics
Can any of the company-specific risk be diversified away by investing in both Sun Country and Chemtrade Logistics 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 Chemtrade Logistics 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 Chemtrade Logistics Income, you can compare the effects of market volatilities on Sun Country and Chemtrade Logistics 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 Chemtrade Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and Chemtrade Logistics.
Diversification Opportunities for Sun Country and Chemtrade Logistics
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sun and Chemtrade is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and Chemtrade Logistics Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemtrade Logistics 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 Chemtrade Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemtrade Logistics has no effect on the direction of Sun Country i.e., Sun Country and Chemtrade Logistics go up and down completely randomly.
Pair Corralation between Sun Country and Chemtrade Logistics
Given the investment horizon of 90 days Sun Country Airlines is expected to generate 1.72 times more return on investment than Chemtrade Logistics. However, Sun Country is 1.72 times more volatile than Chemtrade Logistics Income. It trades about 0.14 of its potential returns per unit of risk. Chemtrade Logistics Income is currently generating about -0.43 per unit of risk. If you would invest 1,447 in Sun Country Airlines on October 10, 2024 and sell it today you would earn a total of 119.00 from holding Sun Country Airlines or generate 8.22% 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. Chemtrade Logistics Income
Performance |
| Timeline |
| Sun Country Airlines |
| Chemtrade Logistics |
Sun Country and Chemtrade Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and Chemtrade Logistics
The main advantage of trading using opposite Sun Country and Chemtrade Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country position performs unexpectedly, Chemtrade Logistics 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 Chemtrade Logistics will offset losses from the drop in Chemtrade Logistics' long position.| Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. Copa Holdings SA | Sun Country vs. SkyWest |
| Chemtrade Logistics vs. Luxfer Holdings PLC | Chemtrade Logistics vs. Jerash Holdings | Chemtrade Logistics vs. CVR Partners LP | Chemtrade Logistics vs. Skechers USA |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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