Correlation Between Samyang Foods and SGC Energy
Can any of the company-specific risk be diversified away by investing in both Samyang Foods and SGC Energy 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 Samyang Foods and SGC Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samyang Foods Co and SGC Energy Co, you can compare the effects of market volatilities on Samyang Foods and SGC Energy 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 Samyang Foods with a short position of SGC Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyang Foods and SGC Energy.
Diversification Opportunities for Samyang Foods and SGC Energy
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samyang and SGC is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Samyang Foods Co and SGC Energy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SGC Energy and Samyang Foods 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 Samyang Foods Co are associated (or correlated) with SGC Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SGC Energy has no effect on the direction of Samyang Foods i.e., Samyang Foods and SGC Energy go up and down completely randomly.
Pair Corralation between Samyang Foods and SGC Energy
Assuming the 90 days trading horizon Samyang Foods Co is expected to generate 1.85 times more return on investment than SGC Energy. However, Samyang Foods is 1.85 times more volatile than SGC Energy Co. It trades about 0.24 of its potential returns per unit of risk. SGC Energy Co is currently generating about -0.07 per unit of risk. If you would invest 56,200,000 in Samyang Foods Co on September 12, 2024 and sell it today you would earn a total of 10,700,000 from holding Samyang Foods Co or generate 19.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Samyang Foods Co vs. SGC Energy Co
Performance |
| Timeline |
| Samyang Foods |
| SGC Energy |
Samyang Foods and SGC Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyang Foods and SGC Energy
The main advantage of trading using opposite Samyang Foods and SGC Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyang Foods position performs unexpectedly, SGC Energy 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 SGC Energy will offset losses from the drop in SGC Energy's long position.| Samyang Foods vs. Samsung Electronics Co | Samyang Foods vs. Samsung Electronics Co | Samyang Foods vs. SK Hynix | Samyang Foods vs. POSCO Holdings |
| SGC Energy vs. Hannong Chemicals | SGC Energy vs. EBEST Investment Securities | SGC Energy vs. E Investment Development | SGC Energy vs. Daehan Synthetic Fiber |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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