Correlation Between SUNEX SA and SOFTWARE MANSION
Can any of the company-specific risk be diversified away by investing in both SUNEX SA and SOFTWARE MANSION 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 SUNEX SA and SOFTWARE MANSION into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SUNEX SA and SOFTWARE MANSION SPOLKA, you can compare the effects of market volatilities on SUNEX SA and SOFTWARE MANSION 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 SUNEX SA with a short position of SOFTWARE MANSION. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUNEX SA and SOFTWARE MANSION.
Diversification Opportunities for SUNEX SA and SOFTWARE MANSION
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SUNEX and SOFTWARE is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding SUNEX SA and SOFTWARE MANSION SPOLKA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOFTWARE MANSION SPOLKA and SUNEX SA 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 SUNEX SA are associated (or correlated) with SOFTWARE MANSION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOFTWARE MANSION SPOLKA has no effect on the direction of SUNEX SA i.e., SUNEX SA and SOFTWARE MANSION go up and down completely randomly.
Pair Corralation between SUNEX SA and SOFTWARE MANSION
Assuming the 90 days trading horizon SUNEX SA is expected to under-perform the SOFTWARE MANSION. But the stock apears to be less risky and, when comparing its historical volatility, SUNEX SA is 1.34 times less risky than SOFTWARE MANSION. The stock trades about -0.07 of its potential returns per unit of risk. The SOFTWARE MANSION SPOLKA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,896 in SOFTWARE MANSION SPOLKA on September 12, 2024 and sell it today you would earn a total of 224.00 from holding SOFTWARE MANSION SPOLKA or generate 7.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 52.53% |
| Values | Daily Returns |
SUNEX SA vs. SOFTWARE MANSION SPOLKA
Performance |
| Timeline |
| SUNEX SA |
| SOFTWARE MANSION SPOLKA |
SUNEX SA and SOFTWARE MANSION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SUNEX SA and SOFTWARE MANSION
The main advantage of trading using opposite SUNEX SA and SOFTWARE MANSION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SUNEX SA position performs unexpectedly, SOFTWARE MANSION 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 SOFTWARE MANSION will offset losses from the drop in SOFTWARE MANSION's long position.| SUNEX SA vs. Quantum Software SA | SUNEX SA vs. New Tech Venture | SUNEX SA vs. Drago entertainment SA | SUNEX SA vs. Creotech Instruments SA |
| SOFTWARE MANSION vs. Banco Santander SA | SOFTWARE MANSION vs. UniCredit SpA | SOFTWARE MANSION vs. CEZ as | SOFTWARE MANSION vs. Polski Koncern Naftowy |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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