Correlation Between Samick Musical and Tway Air
Can any of the company-specific risk be diversified away by investing in both Samick Musical and Tway Air 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 Tway Air 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 Tway Air Co, you can compare the effects of market volatilities on Samick Musical and Tway Air 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 Tway Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samick Musical and Tway Air.
Diversification Opportunities for Samick Musical and Tway Air
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Samick and Tway is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Samick Musical Instruments and Tway Air Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tway Air 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 Tway Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tway Air has no effect on the direction of Samick Musical i.e., Samick Musical and Tway Air go up and down completely randomly.
Pair Corralation between Samick Musical and Tway Air
Assuming the 90 days trading horizon Samick Musical Instruments is expected to under-perform the Tway Air. But the stock apears to be less risky and, when comparing its historical volatility, Samick Musical Instruments is 2.75 times less risky than Tway Air. The stock trades about -0.01 of its potential returns per unit of risk. The Tway Air Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 296,500 in Tway Air Co on September 1, 2024 and sell it today you would lose (2,000) from holding Tway Air Co or give up 0.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samick Musical Instruments vs. Tway Air Co
Performance |
| Timeline |
| Samick Musical Instr |
| Tway Air |
Samick Musical and Tway Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samick Musical and Tway Air
The main advantage of trading using opposite Samick Musical and Tway Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samick Musical position performs unexpectedly, Tway Air 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 Tway Air will offset losses from the drop in Tway Air's long position.| Samick Musical vs. AptaBio Therapeutics | Samick Musical vs. Daewoo SBI SPAC | Samick Musical vs. Dream Security co | Samick Musical vs. Microfriend |
| Tway Air vs. Hanwha InvestmentSecurities Co | Tway Air vs. EBEST Investment Securities | Tway Air vs. Lindeman Asia Investment | Tway Air vs. E Investment Development |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |