Correlation Between Sun Life and Ascent Solar

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

By analyzing existing cross correlation between Sun Life Financial and Ascent Solar Technologies,, you can compare the effects of market volatilities on Sun Life and Ascent Solar 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 Sun Life with a short position of Ascent Solar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Life and Ascent Solar.

Diversification Opportunities for Sun Life and Ascent Solar

-0.34

Correlation Coefficient

Sun Life  Ascent Solar

Very good diversification

The 3 months correlation between Sun and Ascent is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sun Life Financial and Ascent Solar Technologies, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ascent Solar Technol and Sun Life 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 Sun Life Financial are associated (or correlated) with Ascent Solar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ascent Solar Technol has no effect on the direction of Sun Life i.e., Sun Life and Ascent Solar go up and down completely randomly.

Pair Corralation between Sun Life and Ascent Solar

Considering the 90-day investment horizon Sun Life Financial is expected to under-perform the Ascent Solar. But the stock apears to be less risky and, when comparing its historical volatility, Sun Life Financial is 15.54 times less risky than Ascent Solar. The stock trades about -0.36 of its potential returns per unit of risk. The Ascent Solar Technologies, is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  264.00  in Ascent Solar Technologies, on October 10, 2024 and sell it today you would earn a total of  20.00  from holding Ascent Solar Technologies, or generate 7.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Sun Life Financial  vs.  Ascent Solar Technologies,

Sun Life Financial

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Sun Life Financial are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable essential indicators, Sun Life is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Ascent Solar Technol

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ascent Solar Technologies, are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Ascent Solar demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sun Life and Ascent Solar

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

The idea behind Sun Life Financial and Ascent Solar Technologies, 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.