Correlation Between SUN ART and BE Semiconductor

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Can any of the company-specific risk be diversified away by investing in both SUN ART and BE Semiconductor 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 BE Semiconductor 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 BE Semiconductor Industries, you can compare the effects of market volatilities on SUN ART and BE Semiconductor 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 BE Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUN ART and BE Semiconductor.

Diversification Opportunities for SUN ART and BE Semiconductor

-0.52
  Correlation Coefficient

Excellent diversification

The 3 months correlation between SUN and BSI is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding SUN ART RETAIL and BE Semiconductor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BE Semiconductor Ind 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 BE Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BE Semiconductor Ind has no effect on the direction of SUN ART i.e., SUN ART and BE Semiconductor go up and down completely randomly.

Pair Corralation between SUN ART and BE Semiconductor

Assuming the 90 days trading horizon SUN ART RETAIL is expected to under-perform the BE Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, SUN ART RETAIL is 1.01 times less risky than BE Semiconductor. The stock trades about -0.07 of its potential returns per unit of risk. The BE Semiconductor Industries is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  11,520  in BE Semiconductor Industries on September 2, 2025 and sell it today you would earn a total of  1,445  from holding BE Semiconductor Industries or generate 12.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

SUN ART RETAIL  vs.  BE Semiconductor Industries

 Performance 
       Timeline  
SUN ART RETAIL 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days SUN ART RETAIL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's forward indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.
BE Semiconductor Ind 

Risk-Adjusted Performance

Mild

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in BE Semiconductor Industries are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, BE Semiconductor unveiled solid returns over the last few months and may actually be approaching a breakup point.

SUN ART and BE Semiconductor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with SUN ART and BE Semiconductor

The main advantage of trading using opposite SUN ART and BE Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SUN ART position performs unexpectedly, BE Semiconductor 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 BE Semiconductor will offset losses from the drop in BE Semiconductor's long position.
The idea behind SUN ART RETAIL and BE Semiconductor Industries 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.

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