Correlation Between Shinil Electronics and SK Chemicals
Can any of the company-specific risk be diversified away by investing in both Shinil Electronics and SK Chemicals 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 Shinil Electronics and SK Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinil Electronics Co and SK Chemicals Co, you can compare the effects of market volatilities on Shinil Electronics and SK Chemicals 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 Shinil Electronics with a short position of SK Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinil Electronics and SK Chemicals.
Diversification Opportunities for Shinil Electronics and SK Chemicals
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shinil and 285130 is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Shinil Electronics Co and SK Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Chemicals and Shinil Electronics 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 Shinil Electronics Co are associated (or correlated) with SK Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Chemicals has no effect on the direction of Shinil Electronics i.e., Shinil Electronics and SK Chemicals go up and down completely randomly.
Pair Corralation between Shinil Electronics and SK Chemicals
Assuming the 90 days trading horizon Shinil Electronics Co is expected to generate 0.66 times more return on investment than SK Chemicals. However, Shinil Electronics Co is 1.5 times less risky than SK Chemicals. It trades about 0.04 of its potential returns per unit of risk. SK Chemicals Co is currently generating about -0.33 per unit of risk. If you would invest 144,000 in Shinil Electronics Co on August 29, 2024 and sell it today you would earn a total of 1,200 from holding Shinil Electronics Co or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinil Electronics Co vs. SK Chemicals Co
Performance |
| Timeline |
| Shinil Electronics |
| SK Chemicals |
Shinil Electronics and SK Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinil Electronics and SK Chemicals
The main advantage of trading using opposite Shinil Electronics and SK Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinil Electronics position performs unexpectedly, SK Chemicals 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 SK Chemicals will offset losses from the drop in SK Chemicals' long position.| Shinil Electronics vs. Busan Industrial Co | Shinil Electronics vs. Busan Ind | Shinil Electronics vs. Mirae Asset Daewoo | Shinil Electronics vs. UNISEM Co |
| SK Chemicals vs. LG Chemicals | SK Chemicals vs. Lotte Chemical Corp | SK Chemicals vs. Hyundai Steel | SK Chemicals vs. Seah Steel Corp |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Stocks Directory Find actively traded stocks across global markets |