Correlation Between Electreon Wireless and Suny Cellular

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

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

Diversification Opportunities for Electreon Wireless and Suny Cellular

0.11

Correlation Coefficient

Electreon Wireless  Suny Cellular

Average diversification

The 3 months correlation between Electreon and Suny is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Electreon Wireless and Suny Cellular Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suny Cellular Commun and Electreon Wireless 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 Electreon Wireless are associated (or correlated) with Suny Cellular. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suny Cellular Commun has no effect on the direction of Electreon Wireless i.e., Electreon Wireless and Suny Cellular go up and down completely randomly.

Pair Corralation between Electreon Wireless and Suny Cellular

Assuming the 90 days trading horizon Electreon Wireless is expected to generate 3.43 times more return on investment than Suny Cellular. However, Electreon Wireless is 3.43 times more volatile than Suny Cellular Communication. It trades about 0.11 of its potential returns per unit of risk. Suny Cellular Communication is currently generating about 0.05 per unit of risk. If you would invest  291,100  in Electreon Wireless on September 14, 2024 and sell it today you would earn a total of  1,521,900  from holding Electreon Wireless or generate 522.81% return on investment over 90 days.

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

Electreon Wireless  vs.  Suny Cellular Communication

Electreon Wireless

Risk-Adjusted Performance

3 of 100

Insignificant

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

Suny Cellular Commun

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Suny Cellular Communication are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Suny Cellular sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Electreon Wireless and Suny Cellular

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

The idea behind Electreon Wireless and Suny Cellular Communication 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.