Correlation Between Shinil Industrial and Alton Sports
Can any of the company-specific risk be diversified away by investing in both Shinil Industrial and Alton Sports 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 Alton Sports 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 Alton Sports CoLtd, you can compare the effects of market volatilities on Shinil Industrial and Alton Sports 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 Alton Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinil Industrial and Alton Sports.
Diversification Opportunities for Shinil Industrial and Alton Sports
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinil and Alton is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Shinil Industrial Co and Alton Sports CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alton Sports CoLtd 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 Alton Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alton Sports CoLtd has no effect on the direction of Shinil Industrial i.e., Shinil Industrial and Alton Sports go up and down completely randomly.
Pair Corralation between Shinil Industrial and Alton Sports
Assuming the 90 days trading horizon Shinil Industrial Co is expected to generate 0.55 times more return on investment than Alton Sports. However, Shinil Industrial Co is 1.82 times less risky than Alton Sports. It trades about -0.03 of its potential returns per unit of risk. Alton Sports CoLtd is currently generating about -0.1 per unit of risk. If you would invest 167,080 in Shinil Industrial Co on October 16, 2024 and sell it today you would lose (22,980) from holding Shinil Industrial Co or give up 13.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinil Industrial Co vs. Alton Sports CoLtd
Performance |
| Timeline |
| Shinil Industrial |
| Alton Sports CoLtd |
Shinil Industrial and Alton Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinil Industrial and Alton Sports
The main advantage of trading using opposite Shinil Industrial and Alton Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinil Industrial position performs unexpectedly, Alton Sports 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 Alton Sports will offset losses from the drop in Alton Sports' long position.| Shinil Industrial vs. KMH Hitech Co | Shinil Industrial vs. Eagle Veterinary Technology | Shinil Industrial vs. Sewoon Medical Co | Shinil Industrial vs. Sam Yang Foods |
| Alton Sports vs. Shinil Industrial Co | Alton Sports vs. Daiyang Metal Co | Alton Sports vs. Daejung Chemicals Metals | Alton Sports 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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