Correlation Between SeAH Bestee and Keum Kang
Can any of the company-specific risk be diversified away by investing in both SeAH Bestee and Keum Kang 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 SeAH Bestee and Keum Kang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SeAH Bestee and Keum Kang Steel, you can compare the effects of market volatilities on SeAH Bestee and Keum Kang 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 SeAH Bestee with a short position of Keum Kang. Check out your portfolio center. Please also check ongoing floating volatility patterns of SeAH Bestee and Keum Kang.
Diversification Opportunities for SeAH Bestee and Keum Kang
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SeAH and Keum is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding SeAH Bestee and Keum Kang Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keum Kang Steel and SeAH Bestee 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 SeAH Bestee are associated (or correlated) with Keum Kang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keum Kang Steel has no effect on the direction of SeAH Bestee i.e., SeAH Bestee and Keum Kang go up and down completely randomly.
Pair Corralation between SeAH Bestee and Keum Kang
Assuming the 90 days trading horizon SeAH Bestee is expected to generate 1.26 times more return on investment than Keum Kang. However, SeAH Bestee is 1.26 times more volatile than Keum Kang Steel. It trades about 0.0 of its potential returns per unit of risk. Keum Kang Steel is currently generating about -0.05 per unit of risk. If you would invest 2,250,000 in SeAH Bestee on November 19, 2024 and sell it today you would lose (419,000) from holding SeAH Bestee or give up 18.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SeAH Bestee vs. Keum Kang Steel
Performance |
| Timeline |
| SeAH Bestee |
| Keum Kang Steel |
SeAH Bestee and Keum Kang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SeAH Bestee and Keum Kang
The main advantage of trading using opposite SeAH Bestee and Keum Kang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SeAH Bestee position performs unexpectedly, Keum Kang 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 Keum Kang will offset losses from the drop in Keum Kang's long position.| SeAH Bestee vs. Sam Yang Foods | SeAH Bestee vs. Sung Bo Chemicals | SeAH Bestee vs. TK Chemical | SeAH Bestee vs. Hannong Chemicals |
| Keum Kang vs. NH Investment Securities | Keum Kang vs. Leaders Technology Investment | Keum Kang vs. YeaRimDang Publishing Co | Keum Kang vs. DB Financial Investment |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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