Correlation Between Samhwa Paint and Korea Alcohol
Can any of the company-specific risk be diversified away by investing in both Samhwa Paint and Korea Alcohol 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 Samhwa Paint and Korea Alcohol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samhwa Paint Industrial and Korea Alcohol Industrial, you can compare the effects of market volatilities on Samhwa Paint and Korea Alcohol 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 Samhwa Paint with a short position of Korea Alcohol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samhwa Paint and Korea Alcohol.
Diversification Opportunities for Samhwa Paint and Korea Alcohol
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samhwa and Korea is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Samhwa Paint Industrial and Korea Alcohol Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Alcohol Industrial and Samhwa Paint 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 Samhwa Paint Industrial are associated (or correlated) with Korea Alcohol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Alcohol Industrial has no effect on the direction of Samhwa Paint i.e., Samhwa Paint and Korea Alcohol go up and down completely randomly.
Pair Corralation between Samhwa Paint and Korea Alcohol
Assuming the 90 days trading horizon Samhwa Paint Industrial is expected to generate 1.26 times more return on investment than Korea Alcohol. However, Samhwa Paint is 1.26 times more volatile than Korea Alcohol Industrial. It trades about 0.02 of its potential returns per unit of risk. Korea Alcohol Industrial is currently generating about 0.0 per unit of risk. If you would invest 577,515 in Samhwa Paint Industrial on August 30, 2024 and sell it today you would earn a total of 77,485 from holding Samhwa Paint Industrial or generate 13.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samhwa Paint Industrial vs. Korea Alcohol Industrial
Performance |
| Timeline |
| Samhwa Paint Industrial |
| Korea Alcohol Industrial |
Samhwa Paint and Korea Alcohol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samhwa Paint and Korea Alcohol
The main advantage of trading using opposite Samhwa Paint and Korea Alcohol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samhwa Paint position performs unexpectedly, Korea Alcohol 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 Korea Alcohol will offset losses from the drop in Korea Alcohol's long position.| Samhwa Paint vs. AptaBio Therapeutics | Samhwa Paint vs. Daewoo SBI SPAC | Samhwa Paint vs. Dream Security co | Samhwa Paint vs. Microfriend |
| Korea Alcohol vs. Hanil Iron Steel | Korea Alcohol vs. Lotte Non Life Insurance | Korea Alcohol vs. TOPMATERIAL LTD | Korea Alcohol vs. Dongbu Steel Co |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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