Correlation Between Sun Country and Xunlei
Can any of the company-specific risk be diversified away by investing in both Sun Country and Xunlei 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 Xunlei 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 Xunlei Ltd Adr, you can compare the effects of market volatilities on Sun Country and Xunlei 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 Xunlei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Country and Xunlei.
Diversification Opportunities for Sun Country and Xunlei
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sun and Xunlei is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Sun Country Airlines and Xunlei Ltd Adr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xunlei Ltd Adr 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 Xunlei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xunlei Ltd Adr has no effect on the direction of Sun Country i.e., Sun Country and Xunlei go up and down completely randomly.
Pair Corralation between Sun Country and Xunlei
Given the investment horizon of 90 days Sun Country is expected to generate 1.45 times less return on investment than Xunlei. But when comparing it to its historical volatility, Sun Country Airlines is 1.7 times less risky than Xunlei. It trades about 0.38 of its potential returns per unit of risk. Xunlei Ltd Adr is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 205.00 in Xunlei Ltd Adr on November 4, 2024 and sell it today you would earn a total of 55.00 from holding Xunlei Ltd Adr or generate 26.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Country Airlines vs. Xunlei Ltd Adr
Performance |
| Timeline |
| Sun Country Airlines |
| Xunlei Ltd Adr |
Sun Country and Xunlei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Country and Xunlei
The main advantage of trading using opposite Sun Country and Xunlei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Country position performs unexpectedly, Xunlei 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 Xunlei will offset losses from the drop in Xunlei's long position.| Sun Country vs. JetBlue Airways Corp | Sun Country vs. Allegiant Travel | Sun Country vs. Copa Holdings SA | Sun Country vs. SkyWest |
| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |