Correlation Between SunLink Health and International Paper
Can any of the company-specific risk be diversified away by investing in both SunLink Health and International Paper 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 SunLink Health and International Paper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunLink Health Systems and International Paper, you can compare the effects of market volatilities on SunLink Health and International Paper 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 SunLink Health with a short position of International Paper. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunLink Health and International Paper.
Diversification Opportunities for SunLink Health and International Paper
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between SunLink and International is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding SunLink Health Systems and International Paper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Paper and SunLink Health 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 SunLink Health Systems are associated (or correlated) with International Paper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Paper has no effect on the direction of SunLink Health i.e., SunLink Health and International Paper go up and down completely randomly.
Pair Corralation between SunLink Health and International Paper
If you would invest 86.00 in SunLink Health Systems on September 5, 2024 and sell it today you would lose (2.00) from holding SunLink Health Systems or give up 2.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 40.91% |
| Values | Daily Returns |
SunLink Health Systems vs. International Paper
Performance |
| Timeline |
| SunLink Health Systems |
| International Paper |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
SunLink Health and International Paper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunLink Health and International Paper
The main advantage of trading using opposite SunLink Health and International Paper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunLink Health position performs unexpectedly, International Paper 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 International Paper will offset losses from the drop in International Paper's long position.| SunLink Health vs. Leafly Holdings | SunLink Health vs. Allstar Health Brands | SunLink Health vs. Leafly Holdings | SunLink Health vs. Kiaro Holdings Corp |
| International Paper vs. SunLink Health Systems | International Paper vs. Neogen | International Paper vs. Xponential Fitness | International Paper vs. Waters |
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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