Correlation Between Shinil Industrial and Dongwon System
Can any of the company-specific risk be diversified away by investing in both Shinil Industrial and Dongwon System 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 Industrial and Dongwon System into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinil Industrial Co and Dongwon System, you can compare the effects of market volatilities on Shinil Industrial and Dongwon System 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 Industrial with a short position of Dongwon System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinil Industrial and Dongwon System.
Diversification Opportunities for Shinil Industrial and Dongwon System
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinil and Dongwon is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Shinil Industrial Co and Dongwon System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwon System and Shinil Industrial 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 Industrial Co are associated (or correlated) with Dongwon System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwon System has no effect on the direction of Shinil Industrial i.e., Shinil Industrial and Dongwon System go up and down completely randomly.
Pair Corralation between Shinil Industrial and Dongwon System
Assuming the 90 days trading horizon Shinil Industrial Co is expected to generate 0.49 times more return on investment than Dongwon System. However, Shinil Industrial Co is 2.03 times less risky than Dongwon System. It trades about 0.11 of its potential returns per unit of risk. Dongwon System is currently generating about -0.08 per unit of risk. If you would invest 139,532 in Shinil Industrial Co on October 14, 2024 and sell it today you would earn a total of 3,168 from holding Shinil Industrial Co or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinil Industrial Co vs. Dongwon System
Performance |
| Timeline |
| Shinil Industrial |
| Dongwon System |
Shinil Industrial and Dongwon System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinil Industrial and Dongwon System
The main advantage of trading using opposite Shinil Industrial and Dongwon System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinil Industrial position performs unexpectedly, Dongwon System 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 Dongwon System will offset losses from the drop in Dongwon System's long position.| Shinil Industrial vs. Samsung Electronics Co | Shinil Industrial vs. Samsung Electronics Co | Shinil Industrial vs. LG Energy Solution | Shinil Industrial vs. SK Hynix |
| Dongwon System vs. Pyung Hwa Industrial | Dongwon System vs. Shinil Industrial Co | Dongwon System vs. Cheryong Industrial CoLtd | Dongwon System vs. Industrial 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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