Correlation Between Samyang Foods and Samyoung Electronics
Can any of the company-specific risk be diversified away by investing in both Samyang Foods and Samyoung Electronics 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 Samyoung Electronics 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 Samyoung Electronics Co, you can compare the effects of market volatilities on Samyang Foods and Samyoung Electronics 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 Samyoung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyang Foods and Samyoung Electronics.
Diversification Opportunities for Samyang Foods and Samyoung Electronics
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samyang and Samyoung is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Samyang Foods Co and Samyoung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyoung Electronics 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 Samyoung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyoung Electronics has no effect on the direction of Samyang Foods i.e., Samyang Foods and Samyoung Electronics go up and down completely randomly.
Pair Corralation between Samyang Foods and Samyoung Electronics
Assuming the 90 days trading horizon Samyang Foods is expected to generate 8.95 times less return on investment than Samyoung Electronics. In addition to that, Samyang Foods is 2.66 times more volatile than Samyoung Electronics Co. It trades about 0.01 of its total potential returns per unit of risk. Samyoung Electronics Co is currently generating about 0.21 per unit of volatility. If you would invest 960,000 in Samyoung Electronics Co on August 28, 2024 and sell it today you would earn a total of 59,000 from holding Samyoung Electronics Co or generate 6.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samyang Foods Co vs. Samyoung Electronics Co
Performance |
| Timeline |
| Samyang Foods |
| Samyoung Electronics |
Samyang Foods and Samyoung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyang Foods and Samyoung Electronics
The main advantage of trading using opposite Samyang Foods and Samyoung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyang Foods position performs unexpectedly, Samyoung Electronics 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 Samyoung Electronics will offset losses from the drop in Samyoung Electronics' long position.| Samyang Foods vs. AptaBio Therapeutics | Samyang Foods vs. Daewoo SBI SPAC | Samyang Foods vs. Dream Security co | Samyang Foods vs. Microfriend |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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