Correlation Between Sam Yang and Leaders Technology
Can any of the company-specific risk be diversified away by investing in both Sam Yang and Leaders 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 Sam Yang and Leaders Technology 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 Leaders Technology Investment, you can compare the effects of market volatilities on Sam Yang and Leaders 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 Sam Yang with a short position of Leaders Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sam Yang and Leaders Technology.
Diversification Opportunities for Sam Yang and Leaders Technology
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sam and Leaders is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Sam Yang Foods and Leaders Technology Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leaders Technology 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 Leaders Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leaders Technology has no effect on the direction of Sam Yang i.e., Sam Yang and Leaders Technology go up and down completely randomly.
Pair Corralation between Sam Yang and Leaders Technology
Assuming the 90 days trading horizon Sam Yang Foods is expected to generate 0.58 times more return on investment than Leaders Technology. However, Sam Yang Foods is 1.73 times less risky than Leaders Technology. It trades about -0.16 of its potential returns per unit of risk. Leaders Technology Investment is currently generating about -0.1 per unit of risk. If you would invest 75,900,000 in Sam Yang Foods on October 28, 2024 and sell it today you would lose (4,900,000) from holding Sam Yang Foods or give up 6.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sam Yang Foods vs. Leaders Technology Investment
Performance |
| Timeline |
| Sam Yang Foods |
| Leaders Technology |
Sam Yang and Leaders Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sam Yang and Leaders Technology
The main advantage of trading using opposite Sam Yang and Leaders Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sam Yang position performs unexpectedly, Leaders 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 Leaders Technology will offset losses from the drop in Leaders Technology's long position.| Sam Yang vs. Busan Industrial Co | Sam Yang vs. Busan Ind | Sam Yang vs. RPBio Inc | Sam Yang vs. Finebesteel |
| Leaders Technology vs. Samsung Electronics Co | Leaders Technology vs. Samsung Electronics Co | Leaders Technology vs. SK Hynix | Leaders Technology vs. HMM 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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