Correlation Between Samick Musical and Daesung Hi
Can any of the company-specific risk be diversified away by investing in both Samick Musical and Daesung Hi 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 Daesung Hi 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 Daesung Hi Tech Co, you can compare the effects of market volatilities on Samick Musical and Daesung Hi 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 Daesung Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samick Musical and Daesung Hi.
Diversification Opportunities for Samick Musical and Daesung Hi
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samick and Daesung is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Samick Musical Instruments and Daesung Hi Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daesung Hi Tech 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 Daesung Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daesung Hi Tech has no effect on the direction of Samick Musical i.e., Samick Musical and Daesung Hi go up and down completely randomly.
Pair Corralation between Samick Musical and Daesung Hi
Assuming the 90 days trading horizon Samick Musical Instruments is expected to generate 0.32 times more return on investment than Daesung Hi. However, Samick Musical Instruments is 3.13 times less risky than Daesung Hi. It trades about 0.0 of its potential returns per unit of risk. Daesung Hi Tech Co is currently generating about -0.04 per unit of risk. If you would invest 119,655 in Samick Musical Instruments on October 16, 2024 and sell it today you would lose (3,355) from holding Samick Musical Instruments or give up 2.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samick Musical Instruments vs. Daesung Hi Tech Co
Performance |
| Timeline |
| Samick Musical Instr |
| Daesung Hi Tech |
Samick Musical and Daesung Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samick Musical and Daesung Hi
The main advantage of trading using opposite Samick Musical and Daesung Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samick Musical position performs unexpectedly, Daesung Hi 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 Daesung Hi will offset losses from the drop in Daesung Hi's long position.| Samick Musical vs. Daejoo Electronic Materials | Samick Musical vs. Hanwha Chemical Corp | Samick Musical vs. Youngchang Chemical Co | Samick Musical vs. Hanil Chemical Ind |
| Daesung Hi vs. Dongbang Transport Logistics | Daesung Hi vs. Samick Musical Instruments | Daesung Hi vs. Hanjin Transportation Co | Daesung Hi vs. PJ Metal Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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