Correlation Between Sunny Optical and Accenture Plc
Can any of the company-specific risk be diversified away by investing in both Sunny Optical and Accenture Plc 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 Accenture Plc 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 Accenture plc, you can compare the effects of market volatilities on Sunny Optical and Accenture Plc 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 Accenture Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Optical and Accenture Plc.
Diversification Opportunities for Sunny Optical and Accenture Plc
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sunny and Accenture is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Optical Technology and Accenture plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accenture plc 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 Accenture Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accenture plc has no effect on the direction of Sunny Optical i.e., Sunny Optical and Accenture Plc go up and down completely randomly.
Pair Corralation between Sunny Optical and Accenture Plc
Assuming the 90 days horizon Sunny Optical is expected to generate 13.7 times less return on investment than Accenture Plc. In addition to that, Sunny Optical is 2.27 times more volatile than Accenture plc. It trades about 0.0 of its total potential returns per unit of risk. Accenture plc is currently generating about 0.04 per unit of volatility. If you would invest 26,813 in Accenture plc on September 4, 2024 and sell it today you would earn a total of 7,342 from holding Accenture plc or generate 27.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Sunny Optical Technology vs. Accenture plc
Performance |
| Timeline |
| Sunny Optical Technology |
| Accenture plc |
Sunny Optical and Accenture Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Optical and Accenture Plc
The main advantage of trading using opposite Sunny Optical and Accenture Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Optical position performs unexpectedly, Accenture Plc 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 Accenture Plc will offset losses from the drop in Accenture Plc's long position.| Sunny Optical vs. Hon Hai Precision | Sunny Optical vs. Samsung SDI Co | Sunny Optical vs. Murata Manufacturing Co | Sunny Optical vs. Mitsubishi Electric |
| Accenture Plc vs. FUJITSU LTD ADR | Accenture Plc vs. Superior Plus Corp | Accenture Plc vs. NMI Holdings | Accenture Plc vs. Origin Agritech |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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