Correlation Between Samick Musical and Wonil Special
Can any of the company-specific risk be diversified away by investing in both Samick Musical and Wonil Special 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 Samick Musical and Wonil Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samick Musical Instruments and Wonil Special Steel, you can compare the effects of market volatilities on Samick Musical and Wonil Special 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 Samick Musical with a short position of Wonil Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samick Musical and Wonil Special.
Diversification Opportunities for Samick Musical and Wonil Special
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samick and Wonil is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Samick Musical Instruments and Wonil Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonil Special Steel and Samick Musical 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 Samick Musical Instruments are associated (or correlated) with Wonil Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonil Special Steel has no effect on the direction of Samick Musical i.e., Samick Musical and Wonil Special go up and down completely randomly.
Pair Corralation between Samick Musical and Wonil Special
Assuming the 90 days trading horizon Samick Musical Instruments is expected to generate 1.06 times more return on investment than Wonil Special. However, Samick Musical is 1.06 times more volatile than Wonil Special Steel. It trades about 0.03 of its potential returns per unit of risk. Wonil Special Steel is currently generating about -0.08 per unit of risk. If you would invest 103,900 in Samick Musical Instruments on August 29, 2024 and sell it today you would earn a total of 6,200 from holding Samick Musical Instruments or generate 5.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samick Musical Instruments vs. Wonil Special Steel
Performance |
| Timeline |
| Samick Musical Instr |
| Wonil Special Steel |
Samick Musical and Wonil Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samick Musical and Wonil Special
The main advantage of trading using opposite Samick Musical and Wonil Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samick Musical position performs unexpectedly, Wonil Special 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 Wonil Special will offset losses from the drop in Wonil Special's long position.| Samick Musical vs. AptaBio Therapeutics | Samick Musical vs. Daewoo SBI SPAC | Samick Musical vs. Dream Security co | Samick Musical vs. Microfriend |
| Wonil Special vs. Pureun Mutual Savings | Wonil Special vs. InfoBank | Wonil Special vs. Air Busan Co | Wonil Special vs. Jeju Bank |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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