Correlation Between PHOENIX INVESTMENT and SUN

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

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

Diversification Opportunities for PHOENIX INVESTMENT and SUN

-0.71

Correlation Coefficient

PHOENIX INVESTMENT  SUN

Pay attention - limited upside

The 3 months correlation between PHOENIX and SUN is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding PHOENIX INVESTMENT PANY and SUN LIMITED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUN LIMITED and PHOENIX INVESTMENT 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 PHOENIX INVESTMENT PANY are associated (or correlated) with SUN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUN LIMITED has no effect on the direction of PHOENIX INVESTMENT i.e., PHOENIX INVESTMENT and SUN go up and down completely randomly.

Pair Corralation between PHOENIX INVESTMENT and SUN

Assuming the 90 days trading horizon PHOENIX INVESTMENT PANY is expected to generate 2.6 times more return on investment than SUN. However, PHOENIX INVESTMENT is 2.6 times more volatile than SUN LIMITED. It trades about 0.58 of its potential returns per unit of risk. SUN LIMITED is currently generating about 0.4 per unit of risk. If you would invest  36,625  in PHOENIX INVESTMENT PANY on October 14, 2024 and sell it today you would earn a total of  4,875  from holding PHOENIX INVESTMENT PANY or generate 13.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

PHOENIX INVESTMENT PANY  vs.  SUN LIMITED

PHOENIX INVESTMENT PANY

Risk-Adjusted Performance

31 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in PHOENIX INVESTMENT PANY are ranked lower than 31 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, PHOENIX INVESTMENT exhibited solid returns over the last few months and may actually be approaching a breakup point.

SUN LIMITED

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SUN LIMITED has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with PHOENIX INVESTMENT and SUN

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

The idea behind PHOENIX INVESTMENT PANY and SUN LIMITED 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.

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 Transaction History module to view history of all your transactions and understand their impact on performance.