Correlation Between Samyung Trading and Hwashin Precision
Can any of the company-specific risk be diversified away by investing in both Samyung Trading and Hwashin Precision 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 Samyung Trading and Hwashin Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samyung Trading Co and Hwashin Precision Engineering, you can compare the effects of market volatilities on Samyung Trading and Hwashin Precision 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 Samyung Trading with a short position of Hwashin Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyung Trading and Hwashin Precision.
Diversification Opportunities for Samyung Trading and Hwashin Precision
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samyung and Hwashin is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Samyung Trading Co and Hwashin Precision Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hwashin Precision and Samyung Trading 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 Samyung Trading Co are associated (or correlated) with Hwashin Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hwashin Precision has no effect on the direction of Samyung Trading i.e., Samyung Trading and Hwashin Precision go up and down completely randomly.
Pair Corralation between Samyung Trading and Hwashin Precision
Assuming the 90 days trading horizon Samyung Trading Co is expected to under-perform the Hwashin Precision. But the stock apears to be less risky and, when comparing its historical volatility, Samyung Trading Co is 4.41 times less risky than Hwashin Precision. The stock trades about -0.34 of its potential returns per unit of risk. The Hwashin Precision Engineering is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest 124,422 in Hwashin Precision Engineering on October 25, 2024 and sell it today you would earn a total of 44,078 from holding Hwashin Precision Engineering or generate 35.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Samyung Trading Co vs. Hwashin Precision Engineering
Performance |
| Timeline |
| Samyung Trading |
| Hwashin Precision |
Samyung Trading and Hwashin Precision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyung Trading and Hwashin Precision
The main advantage of trading using opposite Samyung Trading and Hwashin Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyung Trading position performs unexpectedly, Hwashin Precision 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 Hwashin Precision will offset losses from the drop in Hwashin Precision's long position.| Samyung Trading vs. National Plastic Co | Samyung Trading vs. Top Material Co | Samyung Trading vs. INNOX Advanced Materials | Samyung Trading vs. CU Medical Systems |
| Hwashin Precision vs. Organic Special Pet | Hwashin Precision vs. Dongil Metal Co | Hwashin Precision vs. Innowireless Co | Hwashin Precision vs. Duksan Hi Metal |
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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