Correlation Between Sam Yang and Heungkuk Metaltech
Can any of the company-specific risk be diversified away by investing in both Sam Yang and Heungkuk Metaltech 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 Sam Yang and Heungkuk Metaltech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sam Yang Foods and Heungkuk Metaltech CoLtd, you can compare the effects of market volatilities on Sam Yang and Heungkuk Metaltech 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 Sam Yang with a short position of Heungkuk Metaltech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sam Yang and Heungkuk Metaltech.
Diversification Opportunities for Sam Yang and Heungkuk Metaltech
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sam and Heungkuk is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Sam Yang Foods and Heungkuk Metaltech CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heungkuk Metaltech CoLtd and Sam Yang 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 Sam Yang Foods are associated (or correlated) with Heungkuk Metaltech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heungkuk Metaltech CoLtd has no effect on the direction of Sam Yang i.e., Sam Yang and Heungkuk Metaltech go up and down completely randomly.
Pair Corralation between Sam Yang and Heungkuk Metaltech
Assuming the 90 days trading horizon Sam Yang Foods is expected to under-perform the Heungkuk Metaltech. In addition to that, Sam Yang is 1.46 times more volatile than Heungkuk Metaltech CoLtd. It trades about -0.16 of its total potential returns per unit of risk. Heungkuk Metaltech CoLtd is currently generating about -0.09 per unit of volatility. If you would invest 532,000 in Heungkuk Metaltech CoLtd on October 28, 2024 and sell it today you would lose (13,000) from holding Heungkuk Metaltech CoLtd or give up 2.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sam Yang Foods vs. Heungkuk Metaltech CoLtd
Performance |
| Timeline |
| Sam Yang Foods |
| Heungkuk Metaltech CoLtd |
Sam Yang and Heungkuk Metaltech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sam Yang and Heungkuk Metaltech
The main advantage of trading using opposite Sam Yang and Heungkuk Metaltech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sam Yang position performs unexpectedly, Heungkuk Metaltech 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 Heungkuk Metaltech will offset losses from the drop in Heungkuk Metaltech's long position.| Sam Yang vs. Taegu Broadcasting | Sam Yang vs. Korea Information Engineering | Sam Yang vs. DataSolution | Sam Yang vs. Daou Data Corp |
| Heungkuk Metaltech vs. Bosung Power Technology | Heungkuk Metaltech vs. Lotte Rental Co | Heungkuk Metaltech vs. Narae Nanotech Corp | Heungkuk Metaltech vs. RFTech 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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