Correlation Between JinkoSolar Holding and SUN LIFE

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

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

Diversification Opportunities for JinkoSolar Holding and SUN LIFE

0.31

Correlation Coefficient

JinkoSolar Holding  SUN LIFE

Weak diversification

The 3 months correlation between JinkoSolar and SUN is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding JinkoSolar Holding 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 JinkoSolar Holding 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 JinkoSolar Holding 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 JinkoSolar Holding i.e., JinkoSolar Holding and SUN LIFE go up and down completely randomly.

Pair Corralation between JinkoSolar Holding and SUN LIFE

Considering the 90-day investment horizon JinkoSolar Holding is expected to under-perform the SUN LIFE. In addition to that, JinkoSolar Holding is 3.47 times more volatile than SUN LIFE FINANCIAL. It trades about -0.01 of its total potential returns per unit of risk. SUN LIFE FINANCIAL is currently generating about 0.25 per unit of volatility. If you would invest  5,027  in SUN LIFE FINANCIAL on October 6, 2024 and sell it today you would earn a total of  673.00  from holding SUN LIFE FINANCIAL or generate 13.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.12%
Values	Daily Returns

JinkoSolar Holding  vs.  SUN LIFE FINANCIAL

JinkoSolar Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JinkoSolar Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward-looking signals remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

SUN LIFE FINANCIAL

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SUN LIFE FINANCIAL are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, SUN LIFE may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with JinkoSolar Holding and SUN LIFE

The main advantage of trading using opposite JinkoSolar Holding and SUN LIFE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JinkoSolar Holding 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.

The idea behind JinkoSolar Holding and SUN LIFE FINANCIAL 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..