Correlation Between Samhwa Paint and MetaLabs
Can any of the company-specific risk be diversified away by investing in both Samhwa Paint and MetaLabs 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 MetaLabs 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 MetaLabs Co, you can compare the effects of market volatilities on Samhwa Paint and MetaLabs 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 MetaLabs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samhwa Paint and MetaLabs.
Diversification Opportunities for Samhwa Paint and MetaLabs
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samhwa and MetaLabs is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Samhwa Paint Industrial and MetaLabs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetaLabs 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 MetaLabs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetaLabs has no effect on the direction of Samhwa Paint i.e., Samhwa Paint and MetaLabs go up and down completely randomly.
Pair Corralation between Samhwa Paint and MetaLabs
Assuming the 90 days trading horizon Samhwa Paint Industrial is expected to generate 0.85 times more return on investment than MetaLabs. However, Samhwa Paint Industrial is 1.18 times less risky than MetaLabs. It trades about -0.05 of its potential returns per unit of risk. MetaLabs Co is currently generating about -0.16 per unit of risk. If you would invest 696,000 in Samhwa Paint Industrial on August 31, 2024 and sell it today you would lose (44,000) from holding Samhwa Paint Industrial or give up 6.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samhwa Paint Industrial vs. MetaLabs Co
Performance |
| Timeline |
| Samhwa Paint Industrial |
| MetaLabs |
Samhwa Paint and MetaLabs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samhwa Paint and MetaLabs
The main advantage of trading using opposite Samhwa Paint and MetaLabs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samhwa Paint position performs unexpectedly, MetaLabs 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 MetaLabs will offset losses from the drop in MetaLabs' long position.| Samhwa Paint vs. Barunson Entertainment Arts | Samhwa Paint vs. Dongil Steel Co | Samhwa Paint vs. T3 Entertainment Co | Samhwa Paint vs. Finebesteel |
| MetaLabs vs. Clean Science co | MetaLabs vs. Digital Power Communications | MetaLabs vs. Daishin Information Communications | MetaLabs vs. Korea Information Communications |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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