Correlation Between Sunrise New and Alfen NV

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

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

Diversification Opportunities for Sunrise New and Alfen NV

0.0

Correlation Coefficient

Sunrise New  Alfen NV

Pay attention - limited upside

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

Pair Corralation between Sunrise New and Alfen NV

If you would invest  89.00  in Sunrise New Energy on December 29, 2024 and sell it today you would earn a total of  13.00  from holding Sunrise New Energy or generate 14.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.31%
Values	Daily Returns

Sunrise New Energy  vs.  Alfen NV

Sunrise New Energy

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sunrise New Energy are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Sunrise New showed solid returns over the last few months and may actually be approaching a breakup point.

Alfen NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alfen NV has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental drivers, Alfen NV is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Sunrise New and Alfen NV

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

The idea behind Sunrise New Energy and Alfen NV 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.

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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.