Correlation Between Suny Cellular and Dan Hotels

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

By analyzing existing cross correlation between Suny Cellular Communication and Dan Hotels, you can compare the effects of market volatilities on Suny Cellular and Dan Hotels 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 Suny Cellular with a short position of Dan Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suny Cellular and Dan Hotels.

Diversification Opportunities for Suny Cellular and Dan Hotels

0.62

Correlation Coefficient

Suny Cellular  Dan Hotels

Poor diversification

The 3 months correlation between Suny and Dan is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Suny Cellular Communication and Dan Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dan Hotels and Suny Cellular 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 Suny Cellular Communication are associated (or correlated) with Dan Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dan Hotels has no effect on the direction of Suny Cellular i.e., Suny Cellular and Dan Hotels go up and down completely randomly.

Pair Corralation between Suny Cellular and Dan Hotels

Assuming the 90 days trading horizon Suny Cellular Communication is expected to generate 1.03 times more return on investment than Dan Hotels. However, Suny Cellular is 1.03 times more volatile than Dan Hotels. It trades about 0.09 of its potential returns per unit of risk. Dan Hotels is currently generating about 0.08 per unit of risk. If you would invest  11,702  in Suny Cellular Communication on December 29, 2024 and sell it today you would earn a total of  868.00  from holding Suny Cellular Communication or generate 7.42% return on investment over 90 days.

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

Suny Cellular Communication  vs.  Dan Hotels

Suny Cellular Commun

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Suny Cellular Communication are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Suny Cellular may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Dan Hotels

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Dan Hotels are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Dan Hotels may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Suny Cellular and Dan Hotels

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

The idea behind Suny Cellular Communication and Dan Hotels 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.