Correlation Between Ontex Group and Sun Country
Can any of the company-specific risk be diversified away by investing in both Ontex Group and Sun Country 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 Ontex Group and Sun Country into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ontex Group NV and Sun Country Airlines, you can compare the effects of market volatilities on Ontex Group and Sun Country 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 Ontex Group with a short position of Sun Country. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ontex Group and Sun Country.
Diversification Opportunities for Ontex Group and Sun Country
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ontex and Sun is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Ontex Group NV and Sun Country Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Country Airlines and Ontex Group 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 Ontex Group NV are associated (or correlated) with Sun Country. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Country Airlines has no effect on the direction of Ontex Group i.e., Ontex Group and Sun Country go up and down completely randomly.
Pair Corralation between Ontex Group and Sun Country
Assuming the 90 days horizon Ontex Group NV is expected to under-perform the Sun Country. But the pink sheet apears to be less risky and, when comparing its historical volatility, Ontex Group NV is 2.79 times less risky than Sun Country. The pink sheet trades about -0.13 of its potential returns per unit of risk. The Sun Country Airlines is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,433 in Sun Country Airlines on December 18, 2024 and sell it today you would lose (80.00) from holding Sun Country Airlines or give up 5.58% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 96.72% |
Values | Daily Returns |
Ontex Group NV vs. Sun Country Airlines
Performance |
Timeline |
Ontex Group NV |
Sun Country Airlines |
Ontex Group and Sun Country Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ontex Group and Sun Country
The main advantage of trading using opposite Ontex Group and Sun Country positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ontex Group position performs unexpectedly, Sun Country 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 Country will offset losses from the drop in Sun Country's long position.Ontex Group vs. Perseus Mining Limited | Ontex Group vs. Paiute Oil Mining | Ontex Group vs. Integrated Media Technology | Ontex Group vs. GoldQuest Mining Corp |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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