Correlation Between Sunny Optical and Sch Environnement
Can any of the company-specific risk be diversified away by investing in both Sunny Optical and Sch Environnement 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 Sch Environnement 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 Sch Environnement SA, you can compare the effects of market volatilities on Sunny Optical and Sch Environnement 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 Sch Environnement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Optical and Sch Environnement.
Diversification Opportunities for Sunny Optical and Sch Environnement
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sunny and Sch is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Optical Technology and Sch Environnement SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sch Environnement 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 Sch Environnement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sch Environnement has no effect on the direction of Sunny Optical i.e., Sunny Optical and Sch Environnement go up and down completely randomly.
Pair Corralation between Sunny Optical and Sch Environnement
Assuming the 90 days horizon Sunny Optical Technology is expected to generate 1.84 times more return on investment than Sch Environnement. However, Sunny Optical is 1.84 times more volatile than Sch Environnement SA. It trades about 0.01 of its potential returns per unit of risk. Sch Environnement SA is currently generating about -0.01 per unit of risk. If you would invest 1,053 in Sunny Optical Technology on November 7, 2024 and sell it today you would lose (190.00) from holding Sunny Optical Technology or give up 18.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunny Optical Technology vs. Sch Environnement SA
Performance |
| Timeline |
| Sunny Optical Technology |
| Sch Environnement |
Sunny Optical and Sch Environnement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Optical and Sch Environnement
The main advantage of trading using opposite Sunny Optical and Sch Environnement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Optical position performs unexpectedly, Sch Environnement 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 Sch Environnement will offset losses from the drop in Sch Environnement's long position.| Sunny Optical vs. Haier Smart Home | Sunny Optical vs. Hisense Home Appliances | Sunny Optical vs. Air Lease | Sunny Optical vs. OFFICE DEPOT |
| Sch Environnement vs. Waste Management | Sch Environnement vs. Republic Services | Sch Environnement vs. Waste Connections | Sch Environnement vs. Veolia Environnement 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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