Correlation Between Sam Yang and Seah Steel
Can any of the company-specific risk be diversified away by investing in both Sam Yang and Seah Steel 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 Seah Steel 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 Seah Steel Corp, you can compare the effects of market volatilities on Sam Yang and Seah Steel 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 Seah Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sam Yang and Seah Steel.
Diversification Opportunities for Sam Yang and Seah Steel
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sam and Seah is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Sam Yang Foods and Seah Steel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seah Steel Corp 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 Seah Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seah Steel Corp has no effect on the direction of Sam Yang i.e., Sam Yang and Seah Steel go up and down completely randomly.
Pair Corralation between Sam Yang and Seah Steel
Assuming the 90 days trading horizon Sam Yang is expected to generate 2.96 times less return on investment than Seah Steel. In addition to that, Sam Yang is 1.78 times more volatile than Seah Steel Corp. It trades about 0.01 of its total potential returns per unit of risk. Seah Steel Corp is currently generating about 0.05 per unit of volatility. If you would invest 11,650,000 in Seah Steel Corp on August 29, 2024 and sell it today you would earn a total of 190,000 from holding Seah Steel Corp or generate 1.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sam Yang Foods vs. Seah Steel Corp
Performance |
| Timeline |
| Sam Yang Foods |
| Seah Steel Corp |
Sam Yang and Seah Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sam Yang and Seah Steel
The main advantage of trading using opposite Sam Yang and Seah Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sam Yang position performs unexpectedly, Seah Steel 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 Seah Steel will offset losses from the drop in Seah Steel's long position.| Sam Yang vs. AptaBio Therapeutics | Sam Yang vs. Daewoo SBI SPAC | Sam Yang vs. Dream Security co | Sam Yang vs. Microfriend |
| Seah Steel vs. Cuckoo Electronics Co | Seah Steel vs. KyungIn Electronics Co | Seah Steel vs. Genie Music | Seah Steel 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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