Correlation Between Sangsangin Investment and Sewoon Medical
Can any of the company-specific risk be diversified away by investing in both Sangsangin Investment and Sewoon Medical 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 Sangsangin Investment and Sewoon Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sangsangin Investment Securities and Sewoon Medical Co, you can compare the effects of market volatilities on Sangsangin Investment and Sewoon Medical 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 Sangsangin Investment with a short position of Sewoon Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sangsangin Investment and Sewoon Medical.
Diversification Opportunities for Sangsangin Investment and Sewoon Medical
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sangsangin and Sewoon is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Sangsangin Investment Securiti and Sewoon Medical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sewoon Medical and Sangsangin Investment 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 Sangsangin Investment Securities are associated (or correlated) with Sewoon Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sewoon Medical has no effect on the direction of Sangsangin Investment i.e., Sangsangin Investment and Sewoon Medical go up and down completely randomly.
Pair Corralation between Sangsangin Investment and Sewoon Medical
Assuming the 90 days trading horizon Sangsangin Investment Securities is expected to generate 0.66 times more return on investment than Sewoon Medical. However, Sangsangin Investment Securities is 1.51 times less risky than Sewoon Medical. It trades about -0.14 of its potential returns per unit of risk. Sewoon Medical Co is currently generating about -0.28 per unit of risk. If you would invest 43,600 in Sangsangin Investment Securities on November 5, 2024 and sell it today you would lose (700.00) from holding Sangsangin Investment Securities or give up 1.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sangsangin Investment Securiti vs. Sewoon Medical Co
Performance |
| Timeline |
| Sangsangin Investment |
| Sewoon Medical |
Sangsangin Investment and Sewoon Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sangsangin Investment and Sewoon Medical
The main advantage of trading using opposite Sangsangin Investment and Sewoon Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sangsangin Investment position performs unexpectedly, Sewoon Medical 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 Sewoon Medical will offset losses from the drop in Sewoon Medical's long position.| Sangsangin Investment vs. Hotel Shilla Co | Sangsangin Investment vs. Dongbang Transport Logistics | Sangsangin Investment vs. Samyung Trading Co | Sangsangin Investment vs. Korea Investment Holdings |
| Sewoon Medical vs. Samsung Electronics Co | Sewoon Medical vs. Samsung Electronics Co | Sewoon Medical vs. KB Financial Group | Sewoon Medical vs. Shinhan Financial Group |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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