Correlation Between Shinil Electronics and Konan Technology
Can any of the company-specific risk be diversified away by investing in both Shinil Electronics and Konan Technology 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 Konan Technology 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 Konan Technology, you can compare the effects of market volatilities on Shinil Electronics and Konan Technology 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 Konan Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinil Electronics and Konan Technology.
Diversification Opportunities for Shinil Electronics and Konan Technology
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shinil and Konan is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Shinil Electronics Co and Konan Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konan Technology 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 Konan Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konan Technology has no effect on the direction of Shinil Electronics i.e., Shinil Electronics and Konan Technology go up and down completely randomly.
Pair Corralation between Shinil Electronics and Konan Technology
Assuming the 90 days trading horizon Shinil Electronics is expected to generate 61.22 times less return on investment than Konan Technology. But when comparing it to its historical volatility, Shinil Electronics Co is 5.01 times less risky than Konan Technology. It trades about 0.04 of its potential returns per unit of risk. Konan Technology is currently generating about 0.44 of returns per unit of risk over similar time horizon. If you would invest 1,440,000 in Konan Technology on August 29, 2024 and sell it today you would earn a total of 1,090,000 from holding Konan Technology or generate 75.69% 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. Konan Technology
Performance |
| Timeline |
| Shinil Electronics |
| Konan Technology |
Shinil Electronics and Konan Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinil Electronics and Konan Technology
The main advantage of trading using opposite Shinil Electronics and Konan Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinil Electronics position performs unexpectedly, Konan Technology 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 Konan Technology will offset losses from the drop in Konan Technology's long position.| Shinil Electronics vs. Busan Industrial Co | Shinil Electronics vs. Busan Ind | Shinil Electronics vs. Mirae Asset Daewoo | Shinil Electronics vs. UNISEM Co |
| Konan Technology vs. Posco ICT | Konan Technology vs. Devsisters corporation | Konan Technology vs. Nice Information Telecommunication | Konan Technology vs. InfoBank |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |