Correlation Between Sun Art and Scientific Games
Can any of the company-specific risk be diversified away by investing in both Sun Art and Scientific Games 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 Art and Scientific Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Art Retail and Scientific Games, you can compare the effects of market volatilities on Sun Art and Scientific Games 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 Art with a short position of Scientific Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Art and Scientific Games.
Diversification Opportunities for Sun Art and Scientific Games
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sun and Scientific is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Sun Art Retail and Scientific Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scientific Games and Sun Art 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 Art Retail are associated (or correlated) with Scientific Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scientific Games has no effect on the direction of Sun Art i.e., Sun Art and Scientific Games go up and down completely randomly.
Pair Corralation between Sun Art and Scientific Games
Assuming the 90 days trading horizon Sun Art Retail is expected to generate 16.69 times more return on investment than Scientific Games. However, Sun Art is 16.69 times more volatile than Scientific Games. It trades about 0.13 of its potential returns per unit of risk. Scientific Games is currently generating about -0.4 per unit of risk. If you would invest 25.00 in Sun Art Retail on September 25, 2024 and sell it today you would earn a total of 3.00 from holding Sun Art Retail or generate 12.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Sun Art Retail vs. Scientific Games
Performance |
Timeline |
Sun Art Retail |
Scientific Games |
Sun Art and Scientific Games Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sun Art and Scientific Games
The main advantage of trading using opposite Sun Art and Scientific Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Art position performs unexpectedly, Scientific Games 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 Scientific Games will offset losses from the drop in Scientific Games' long position.Sun Art vs. Meli Hotels International | Sun Art vs. MHP Hotel AG | Sun Art vs. Hyatt Hotels | Sun Art vs. Wyndham Hotels Resorts |
Scientific Games vs. Sun Art Retail | Scientific Games vs. Caseys General Stores | Scientific Games vs. The Yokohama Rubber | Scientific Games vs. EAGLE MATERIALS |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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