Correlation Between Samyang Foods and ADTechnology CoLtd

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Can any of the company-specific risk be diversified away by investing in both Samyang Foods and ADTechnology CoLtd 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 ADTechnology CoLtd 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 ADTechnology CoLtd, you can compare the effects of market volatilities on Samyang Foods and ADTechnology CoLtd 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 ADTechnology CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyang Foods and ADTechnology CoLtd.

Diversification Opportunities for Samyang Foods and ADTechnology CoLtd

SamyangADTechnologyDiversified AwaySamyangADTechnologyDiversified Away100%
0.78
  Correlation Coefficient

Poor diversification

The 3 months correlation between Samyang and ADTechnology is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Samyang Foods Co and ADTechnology CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADTechnology CoLtd 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 ADTechnology CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADTechnology CoLtd has no effect on the direction of Samyang Foods i.e., Samyang Foods and ADTechnology CoLtd go up and down completely randomly.

Pair Corralation between Samyang Foods and ADTechnology CoLtd

Assuming the 90 days trading horizon Samyang Foods Co is expected to generate 0.93 times more return on investment than ADTechnology CoLtd. However, Samyang Foods Co is 1.08 times less risky than ADTechnology CoLtd. It trades about 0.23 of its potential returns per unit of risk. ADTechnology CoLtd is currently generating about 0.11 per unit of risk. If you would invest  73,700,000  in Samyang Foods Co on November 21, 2024 and sell it today you would earn a total of  13,700,000  from holding Samyang Foods Co or generate 18.59% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Samyang Foods Co  vs.  ADTechnology CoLtd

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -30-20-10010203040
JavaScript chart by amCharts 3.21.15003230 200710
       Timeline  
Samyang Foods 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Samyang Foods Co are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Samyang Foods sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb500,000550,000600,000650,000700,000750,000800,000850,000900,000
ADTechnology CoLtd 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in ADTechnology CoLtd are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, ADTechnology CoLtd sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb12,00014,00016,00018,00020,00022,000

Samyang Foods and ADTechnology CoLtd Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-10.68-8.0-5.32-2.640.02.855.88.7511.714.65 0.0150.0200.0250.030
JavaScript chart by amCharts 3.21.15003230 200710
       Returns  

Pair Trading with Samyang Foods and ADTechnology CoLtd

The main advantage of trading using opposite Samyang Foods and ADTechnology CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyang Foods position performs unexpectedly, ADTechnology CoLtd 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 ADTechnology CoLtd will offset losses from the drop in ADTechnology CoLtd's long position.
The idea behind Samyang Foods Co and ADTechnology CoLtd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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