Correlation Between Sun Country and Schneider National
Can any of the company-specific risk be diversified away by investing in both Sun Country and Schneider National 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 Schneider National 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 Schneider National, you can compare the effects of market volatilities on Sun Country and Schneider National 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 Schneider National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and Schneider National.
Diversification Opportunities for Sun Country and Schneider National
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sun and Schneider is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and Schneider National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schneider National 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 Schneider National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schneider National has no effect on the direction of Sun Country i.e., Sun Country and Schneider National go up and down completely randomly.
Pair Corralation between Sun Country and Schneider National
Given the investment horizon of 90 days Sun Country Airlines is expected to generate 2.3 times more return on investment than Schneider National. However, Sun Country is 2.3 times more volatile than Schneider National. It trades about 0.1 of its potential returns per unit of risk. Schneider National is currently generating about 0.19 per unit of risk. If you would invest 956.00 in Sun Country Airlines on August 24, 2024 and sell it today you would earn a total of 435.00 from holding Sun Country Airlines or generate 45.5% 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. Schneider National
Performance |
| Timeline |
| Sun Country Airlines |
| Schneider National |
Sun Country and Schneider National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and Schneider National
The main advantage of trading using opposite Sun Country and Schneider National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country position performs unexpectedly, Schneider National 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 Schneider National will offset losses from the drop in Schneider National's long position.| Sun Country vs. Spirit Airlines | Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. Copa Holdings SA |
| Schneider National vs. Small Cap Core | Schneider National vs. Morningstar Unconstrained Allocation | Schneider National vs. Mutual Of America | Schneider National vs. Ep Emerging Markets |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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