Correlation Between Xtract One and Sun Life
Can any of the company-specific risk be diversified away by investing in both Xtract One and Sun Life 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 Xtract One and Sun Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xtract One Technologies and Sun Life Financial, you can compare the effects of market volatilities on Xtract One and Sun Life 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 Xtract One with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtract One and Sun Life.
Diversification Opportunities for Xtract One and Sun Life
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Xtract and Sun is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Xtract One Technologies and Sun Life Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Life Financial and Xtract One 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 Xtract One Technologies are associated (or correlated) with Sun Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Life Financial has no effect on the direction of Xtract One i.e., Xtract One and Sun Life go up and down completely randomly.
Pair Corralation between Xtract One and Sun Life
Assuming the 90 days trading horizon Xtract One Technologies is expected to under-perform the Sun Life. In addition to that, Xtract One is 3.05 times more volatile than Sun Life Financial. It trades about -0.06 of its total potential returns per unit of risk. Sun Life Financial is currently generating about -0.06 per unit of volatility. If you would invest 2,035 in Sun Life Financial on September 4, 2024 and sell it today you would lose (17.00) from holding Sun Life Financial or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Xtract One Technologies vs. Sun Life Financial
Performance |
| Timeline |
| Xtract One Technologies |
| Sun Life Financial |
Xtract One and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xtract One and Sun Life
The main advantage of trading using opposite Xtract One and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtract One position performs unexpectedly, Sun Life 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 Sun Life will offset losses from the drop in Sun Life's long position.| Xtract One vs. Cogeco Communications | Xtract One vs. Chemtrade Logistics Income | Xtract One vs. American Hotel Income | Xtract One vs. Primaris Retail RE |
| Sun Life vs. SPoT Coffee | Sun Life vs. Xtract One Technologies | Sun Life vs. NorthWest Healthcare Properties | Sun Life vs. Evertz Technologies Limited |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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