Correlation Between Sun Country and Marfrig Global
Can any of the company-specific risk be diversified away by investing in both Sun Country and Marfrig Global 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 Marfrig Global 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 Marfrig Global Foods, you can compare the effects of market volatilities on Sun Country and Marfrig Global 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 Marfrig Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and Marfrig Global.
Diversification Opportunities for Sun Country and Marfrig Global
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sun and Marfrig is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and Marfrig Global Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marfrig Global Foods 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 Marfrig Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marfrig Global Foods has no effect on the direction of Sun Country i.e., Sun Country and Marfrig Global go up and down completely randomly.
Pair Corralation between Sun Country and Marfrig Global
Given the investment horizon of 90 days Sun Country Airlines is expected to under-perform the Marfrig Global. In addition to that, Sun Country is 1.04 times more volatile than Marfrig Global Foods. It trades about -0.01 of its total potential returns per unit of risk. Marfrig Global Foods is currently generating about 0.08 per unit of volatility. If you would invest 142.00 in Marfrig Global Foods on August 31, 2024 and sell it today you would earn a total of 168.00 from holding Marfrig Global Foods or generate 118.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Sun Country Airlines vs. Marfrig Global Foods
Performance |
| Timeline |
| Sun Country Airlines |
| Marfrig Global Foods |
Sun Country and Marfrig Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and Marfrig Global
The main advantage of trading using opposite Sun Country and Marfrig Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country position performs unexpectedly, Marfrig Global 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 Marfrig Global will offset losses from the drop in Marfrig Global's long position.| Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. SkyWest | Sun Country vs. Air Transport Services |
| Marfrig Global vs. The A2 Milk | Marfrig Global vs. Altavoz Entertainment | Marfrig Global vs. Artisan Consumer Goods | Marfrig Global vs. General Mills |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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