Correlation Between Samhwa Paint and Namhwa Industrial
Can any of the company-specific risk be diversified away by investing in both Samhwa Paint and Namhwa Industrial 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 Namhwa Industrial 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 Namhwa Industrial Co, you can compare the effects of market volatilities on Samhwa Paint and Namhwa Industrial 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 Namhwa Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samhwa Paint and Namhwa Industrial.
Diversification Opportunities for Samhwa Paint and Namhwa Industrial
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samhwa and Namhwa is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Samhwa Paint Industrial and Namhwa Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Namhwa 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 Namhwa Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Namhwa Industrial has no effect on the direction of Samhwa Paint i.e., Samhwa Paint and Namhwa Industrial go up and down completely randomly.
Pair Corralation between Samhwa Paint and Namhwa Industrial
Assuming the 90 days trading horizon Samhwa Paint Industrial is expected to under-perform the Namhwa Industrial. In addition to that, Samhwa Paint is 1.18 times more volatile than Namhwa Industrial Co. It trades about -0.19 of its total potential returns per unit of risk. Namhwa Industrial Co is currently generating about 0.07 per unit of volatility. If you would invest 534,000 in Namhwa Industrial Co on August 30, 2024 and sell it today you would earn a total of 13,000 from holding Namhwa Industrial Co or generate 2.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samhwa Paint Industrial vs. Namhwa Industrial Co
Performance |
| Timeline |
| Samhwa Paint Industrial |
| Namhwa Industrial |
Samhwa Paint and Namhwa Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samhwa Paint and Namhwa Industrial
The main advantage of trading using opposite Samhwa Paint and Namhwa Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samhwa Paint position performs unexpectedly, Namhwa Industrial 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 Namhwa Industrial will offset losses from the drop in Namhwa Industrial's long position.| Samhwa Paint vs. AptaBio Therapeutics | Samhwa Paint vs. Daewoo SBI SPAC | Samhwa Paint vs. Dream Security co | Samhwa Paint vs. Microfriend |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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