Correlation Between Sunny Optical and Brinks
Can any of the company-specific risk be diversified away by investing in both Sunny Optical and Brinks 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 Brinks 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 The Brinks, you can compare the effects of market volatilities on Sunny Optical and Brinks 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 Brinks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Optical and Brinks.
Diversification Opportunities for Sunny Optical and Brinks
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sunny and Brinks is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Optical Technology and The Brinks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brinks 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 Brinks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brinks has no effect on the direction of Sunny Optical i.e., Sunny Optical and Brinks go up and down completely randomly.
Pair Corralation between Sunny Optical and Brinks
Assuming the 90 days horizon Sunny Optical is expected to generate 1.46 times less return on investment than Brinks. In addition to that, Sunny Optical is 2.06 times more volatile than The Brinks. It trades about 0.02 of its total potential returns per unit of risk. The Brinks is currently generating about 0.07 per unit of volatility. If you would invest 5,844 in The Brinks on October 30, 2024 and sell it today you would earn a total of 2,906 from holding The Brinks or generate 49.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.75% |
| Values | Daily Returns |
Sunny Optical Technology vs. The Brinks
Performance |
| Timeline |
| Sunny Optical Technology |
| Brinks |
Sunny Optical and Brinks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Optical and Brinks
The main advantage of trading using opposite Sunny Optical and Brinks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Optical position performs unexpectedly, Brinks 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 Brinks will offset losses from the drop in Brinks' long position.| Sunny Optical vs. Diamyd Medical AB | Sunny Optical vs. Merit Medical Systems | Sunny Optical vs. Firan Technology Group | Sunny Optical vs. Amkor Technology |
| Brinks vs. HOME DEPOT | Brinks vs. TOWNSQUARE MEDIA INC | Brinks vs. Taylor Morrison Home | Brinks vs. Aedas Homes SA |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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