Correlation Between Advtech and Sun International

Can any of the company-specific risk be diversified away by investing in both Advtech and Sun International 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 Advtech and Sun International into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Advtech and Sun International, you can compare the effects of market volatilities on Advtech and Sun International 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 Advtech with a short position of Sun International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advtech and Sun International.

Diversification Opportunities for Advtech and Sun International

0.0

Correlation Coefficient

Advtech  Sun International

Pay attention - limited upside

The 3 months correlation between Advtech and Sun is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Advtech and Sun International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun International and Advtech 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 Advtech are associated (or correlated) with Sun International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun International has no effect on the direction of Advtech i.e., Advtech and Sun International go up and down completely randomly.

Pair Corralation between Advtech and Sun International

If you would invest (100.00) in Sun International on December 21, 2024 and sell it today you would earn a total of  100.00  from holding Sun International or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Advtech  vs.  Sun International

Advtech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Advtech has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Advtech is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Sun International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sun International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Sun International is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Advtech and Sun International

The main advantage of trading using opposite Advtech and Sun International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advtech position performs unexpectedly, Sun International 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 International will offset losses from the drop in Sun International's long position.

The idea behind Advtech and Sun International pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.