Correlation Between Sangsangin Investment and Lion Chemtech
Can any of the company-specific risk be diversified away by investing in both Sangsangin Investment and Lion Chemtech 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 Lion Chemtech 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 Lion Chemtech Co, you can compare the effects of market volatilities on Sangsangin Investment and Lion Chemtech 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 Lion Chemtech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sangsangin Investment and Lion Chemtech.
Diversification Opportunities for Sangsangin Investment and Lion Chemtech
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sangsangin and Lion is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Sangsangin Investment Securiti and Lion Chemtech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Chemtech 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 Lion Chemtech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Chemtech has no effect on the direction of Sangsangin Investment i.e., Sangsangin Investment and Lion Chemtech go up and down completely randomly.
Pair Corralation between Sangsangin Investment and Lion Chemtech
Assuming the 90 days trading horizon Sangsangin Investment Securities is expected to generate 0.4 times more return on investment than Lion Chemtech. However, Sangsangin Investment Securities is 2.47 times less risky than Lion Chemtech. It trades about -0.14 of its potential returns per unit of risk. Lion Chemtech Co is currently generating about -0.16 per unit of risk. If you would invest 43,600 in Sangsangin Investment Securities on November 7, 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 Against |
| Strength | Insignificant |
| Accuracy | 89.47% |
| Values | Daily Returns |
Sangsangin Investment Securiti vs. Lion Chemtech Co
Performance |
| Timeline |
| Sangsangin Investment |
| Lion Chemtech |
Sangsangin Investment and Lion Chemtech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sangsangin Investment and Lion Chemtech
The main advantage of trading using opposite Sangsangin Investment and Lion Chemtech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sangsangin Investment position performs unexpectedly, Lion Chemtech 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 Lion Chemtech will offset losses from the drop in Lion Chemtech's long position.| Sangsangin Investment vs. Cots Technology Co | Sangsangin Investment vs. Global Standard Technology | Sangsangin Investment vs. Mobile Appliance | Sangsangin Investment vs. Korea Plasma Technology |
| Lion Chemtech vs. Kuk Young GM | Lion Chemtech vs. Nature and Environment | Lion Chemtech vs. Cheryong Industrial CoLtd |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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