Correlation Between Dividend and Sun Life
Can any of the company-specific risk be diversified away by investing in both Dividend and Sun Life 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 Dividend and Sun Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dividend 15 Split and Sun Life Financial, you can compare the effects of market volatilities on Dividend and Sun Life 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 Dividend with a short position of Sun Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dividend and Sun Life.
Diversification Opportunities for Dividend and Sun Life
Very poor diversification
The 3 months correlation between Dividend and Sun is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Dividend 15 Split and Sun Life Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Life Financial and Dividend 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 Dividend 15 Split are associated (or correlated) with Sun Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Life Financial has no effect on the direction of Dividend i.e., Dividend and Sun Life go up and down completely randomly.
Pair Corralation between Dividend and Sun Life
Assuming the 90 days horizon Dividend 15 Split is expected to generate 0.41 times more return on investment than Sun Life. However, Dividend 15 Split is 2.47 times less risky than Sun Life. It trades about 0.47 of its potential returns per unit of risk. Sun Life Financial is currently generating about 0.05 per unit of risk. If you would invest 602.00 in Dividend 15 Split on August 5, 2025 and sell it today you would earn a total of 101.00 from holding Dividend 15 Split or generate 16.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dividend 15 Split vs. Sun Life Financial
Performance |
| Timeline |
| Dividend 15 Split |
| Sun Life Financial |
Dividend and Sun Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dividend and Sun Life
The main advantage of trading using opposite Dividend and Sun Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dividend position performs unexpectedly, Sun Life 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 Life will offset losses from the drop in Sun Life's long position.| Dividend vs. Premium Income | Dividend vs. Stack Capital Group | Dividend vs. Canadian Life Companies | Dividend vs. Real Estate E Commerce |
| Sun Life vs. Manulife Financial Corp | Sun Life vs. Great West Lifeco | Sun Life vs. Intact Financial | Sun Life vs. Toronto Dominion Bank Pref |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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