Correlation Between Sunny Optical and AOYAMA TRADING
Can any of the company-specific risk be diversified away by investing in both Sunny Optical and AOYAMA TRADING 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 Sunny Optical and AOYAMA TRADING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunny Optical Technology and AOYAMA TRADING, you can compare the effects of market volatilities on Sunny Optical and AOYAMA TRADING 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 Sunny Optical with a short position of AOYAMA TRADING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Optical and AOYAMA TRADING.
Diversification Opportunities for Sunny Optical and AOYAMA TRADING
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sunny and AOYAMA is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Optical Technology and AOYAMA TRADING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AOYAMA TRADING and Sunny Optical 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 Sunny Optical Technology are associated (or correlated) with AOYAMA TRADING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AOYAMA TRADING has no effect on the direction of Sunny Optical i.e., Sunny Optical and AOYAMA TRADING go up and down completely randomly.
Pair Corralation between Sunny Optical and AOYAMA TRADING
Assuming the 90 days horizon Sunny Optical Technology is expected to generate 2.43 times more return on investment than AOYAMA TRADING. However, Sunny Optical is 2.43 times more volatile than AOYAMA TRADING. It trades about -0.06 of its potential returns per unit of risk. AOYAMA TRADING is currently generating about -0.27 per unit of risk. If you would invest 791.00 in Sunny Optical Technology on October 13, 2024 and sell it today you would lose (33.00) from holding Sunny Optical Technology or give up 4.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunny Optical Technology vs. AOYAMA TRADING
Performance |
| Timeline |
| Sunny Optical Technology |
| AOYAMA TRADING |
Sunny Optical and AOYAMA TRADING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Optical and AOYAMA TRADING
The main advantage of trading using opposite Sunny Optical and AOYAMA TRADING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Optical position performs unexpectedly, AOYAMA TRADING 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 AOYAMA TRADING will offset losses from the drop in AOYAMA TRADING's long position.| Sunny Optical vs. INDOFOOD AGRI RES | Sunny Optical vs. Datadog | Sunny Optical vs. DATATEC LTD 2 | Sunny Optical vs. Thai Beverage Public |
| AOYAMA TRADING vs. PENN NATL GAMING | AOYAMA TRADING vs. GigaMedia | AOYAMA TRADING vs. BRAGG GAMING GRP | AOYAMA TRADING vs. PROSIEBENSAT1 MEDIADR4 |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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