Correlation Between Lease IT and Sun Vending
Can any of the company-specific risk be diversified away by investing in both Lease IT and Sun Vending 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 Lease IT and Sun Vending into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lease IT Public and Sun Vending Technology, you can compare the effects of market volatilities on Lease IT and Sun Vending 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 Lease IT with a short position of Sun Vending. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lease IT and Sun Vending.
Diversification Opportunities for Lease IT and Sun Vending
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lease and Sun is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Lease IT Public and Sun Vending Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Vending Technology and Lease IT 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 Lease IT Public are associated (or correlated) with Sun Vending. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Vending Technology has no effect on the direction of Lease IT i.e., Lease IT and Sun Vending go up and down completely randomly.
Pair Corralation between Lease IT and Sun Vending
Assuming the 90 days trading horizon Lease IT Public is expected to under-perform the Sun Vending. In addition to that, Lease IT is 3.23 times more volatile than Sun Vending Technology. It trades about -0.09 of its total potential returns per unit of risk. Sun Vending Technology is currently generating about -0.09 per unit of volatility. If you would invest 153.00 in Sun Vending Technology on December 3, 2024 and sell it today you would lose (14.00) from holding Sun Vending Technology or give up 9.15% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Lease IT Public vs. Sun Vending Technology
Performance |
Timeline |
Lease IT Public |
Sun Vending Technology |
Lease IT and Sun Vending Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lease IT and Sun Vending
The main advantage of trading using opposite Lease IT and Sun Vending positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lease IT position performs unexpectedly, Sun Vending 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 Vending will offset losses from the drop in Sun Vending's long position.Lease IT vs. Multibax Public | Lease IT vs. Forth Smart Service | Lease IT vs. LPN Development Public | Lease IT vs. Netbay Public |
Sun Vending vs. Hana Microelectronics Public | Sun Vending vs. Global Power Synergy | Sun Vending vs. Siam Global House | Sun Vending vs. Gulf Energy Development |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |