Correlation Between SUN ART and Apple
Can any of the company-specific risk be diversified away by investing in both SUN ART and Apple 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 ART and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SUN ART RETAIL and Apple Inc, you can compare the effects of market volatilities on SUN ART and Apple 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 ART with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUN ART and Apple.
Diversification Opportunities for SUN ART and Apple
Poor diversification
The 3 months correlation between SUN and Apple is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding SUN ART RETAIL and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and SUN ART 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 ART RETAIL are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of SUN ART i.e., SUN ART and Apple go up and down completely randomly.
Pair Corralation between SUN ART and Apple
Assuming the 90 days trading horizon SUN ART RETAIL is expected to generate 25.36 times more return on investment than Apple. However, SUN ART is 25.36 times more volatile than Apple Inc. It trades about 0.17 of its potential returns per unit of risk. Apple Inc is currently generating about -0.15 per unit of risk. If you would invest 14.00 in SUN ART RETAIL on October 13, 2024 and sell it today you would earn a total of 8.00 from holding SUN ART RETAIL or generate 57.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
SUN ART RETAIL vs. Apple Inc
Performance |
| Timeline |
| SUN ART RETAIL |
| Apple Inc |
SUN ART and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SUN ART and Apple
The main advantage of trading using opposite SUN ART and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SUN ART position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| SUN ART vs. CALTAGIRONE EDITORE | SUN ART vs. United States Steel | SUN ART vs. COSMOSTEEL HLDGS | SUN ART vs. INSURANCE AUST GRP |
| Apple vs. SCANSOURCE | Apple vs. Zijin Mining Group | Apple vs. Shenandoah Telecommunications | Apple vs. ADRIATIC METALS LS 013355 |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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