Correlation Between Income Financial and Sun Peak
Can any of the company-specific risk be diversified away by investing in both Income Financial and Sun Peak 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 Income Financial and Sun Peak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Income Financial Trust and Sun Peak Metals, you can compare the effects of market volatilities on Income Financial and Sun Peak 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 Income Financial with a short position of Sun Peak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Income Financial and Sun Peak.
Diversification Opportunities for Income Financial and Sun Peak
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Income and Sun is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Income Financial Trust and Sun Peak Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Peak Metals and Income Financial 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 Income Financial Trust are associated (or correlated) with Sun Peak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Peak Metals has no effect on the direction of Income Financial i.e., Income Financial and Sun Peak go up and down completely randomly.
Pair Corralation between Income Financial and Sun Peak
Assuming the 90 days trading horizon Income Financial Trust is expected to generate 0.25 times more return on investment than Sun Peak. However, Income Financial Trust is 4.05 times less risky than Sun Peak. It trades about 0.12 of its potential returns per unit of risk. Sun Peak Metals is currently generating about -0.14 per unit of risk. If you would invest 821.00 in Income Financial Trust on October 26, 2024 and sell it today you would earn a total of 70.00 from holding Income Financial Trust or generate 8.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Income Financial Trust vs. Sun Peak Metals
Performance |
Timeline |
Income Financial Trust |
Sun Peak Metals |
Income Financial and Sun Peak Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Income Financial and Sun Peak
The main advantage of trading using opposite Income Financial and Sun Peak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Income Financial position performs unexpectedly, Sun Peak 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 Peak will offset losses from the drop in Sun Peak's long position.Income Financial vs. Uniteds Limited | Income Financial vs. Economic Investment Trust | Income Financial vs. Clairvest Group | Income Financial vs. Cogeco Inc |
Sun Peak vs. Forsys Metals Corp | Sun Peak vs. T2 Metals Corp | Sun Peak vs. Solid Impact Investments | Sun Peak vs. Constellation 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Stocks Directory Find actively traded stocks across global markets |