Correlation Between Take-Two Interactive and Sunny Optical
Can any of the company-specific risk be diversified away by investing in both Take-Two Interactive and Sunny Optical 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 Take-Two Interactive and Sunny Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Take Two Interactive Software and Sunny Optical Technology, you can compare the effects of market volatilities on Take-Two Interactive and Sunny Optical 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 Take-Two Interactive with a short position of Sunny Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Take-Two Interactive and Sunny Optical.
Diversification Opportunities for Take-Two Interactive and Sunny Optical
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Take-Two and Sunny is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Take Two Interactive Software and Sunny Optical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Optical Technology and Take-Two Interactive 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 Take Two Interactive Software are associated (or correlated) with Sunny Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Optical Technology has no effect on the direction of Take-Two Interactive i.e., Take-Two Interactive and Sunny Optical go up and down completely randomly.
Pair Corralation between Take-Two Interactive and Sunny Optical
Assuming the 90 days horizon Take Two Interactive Software is expected to generate 0.51 times more return on investment than Sunny Optical. However, Take Two Interactive Software is 1.94 times less risky than Sunny Optical. It trades about 0.07 of its potential returns per unit of risk. Sunny Optical Technology is currently generating about 0.01 per unit of risk. If you would invest 9,712 in Take Two Interactive Software on September 24, 2024 and sell it today you would earn a total of 7,720 from holding Take Two Interactive Software or generate 79.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Take Two Interactive Software vs. Sunny Optical Technology
Performance |
| Timeline |
| Take Two Interactive |
| Sunny Optical Technology |
Take-Two Interactive and Sunny Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Take-Two Interactive and Sunny Optical
The main advantage of trading using opposite Take-Two Interactive and Sunny Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Take-Two Interactive position performs unexpectedly, Sunny Optical 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 Sunny Optical will offset losses from the drop in Sunny Optical's long position.| Take-Two Interactive vs. Evolution Mining Limited | Take-Two Interactive vs. GALENA MINING LTD | Take-Two Interactive vs. ADRIATIC METALS LS 013355 | Take-Two Interactive vs. LION ONE METALS |
| Sunny Optical vs. G III Apparel Group | Sunny Optical vs. ATOSS SOFTWARE | Sunny Optical vs. Take Two Interactive Software | Sunny Optical vs. CyberArk Software |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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