Correlation Between Samyang Foods and BGF Retail
Can any of the company-specific risk be diversified away by investing in both Samyang Foods and BGF Retail 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 BGF Retail 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 BGF Retail Co, you can compare the effects of market volatilities on Samyang Foods and BGF Retail 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 BGF Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyang Foods and BGF Retail.
Diversification Opportunities for Samyang Foods and BGF Retail
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samyang and BGF is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Samyang Foods Co and BGF Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGF Retail 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 BGF Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGF Retail has no effect on the direction of Samyang Foods i.e., Samyang Foods and BGF Retail go up and down completely randomly.
Pair Corralation between Samyang Foods and BGF Retail
Assuming the 90 days trading horizon Samyang Foods Co is expected to generate 1.93 times more return on investment than BGF Retail. However, Samyang Foods is 1.93 times more volatile than BGF Retail Co. It trades about 0.12 of its potential returns per unit of risk. BGF Retail Co is currently generating about -0.06 per unit of risk. If you would invest 11,645,300 in Samyang Foods Co on August 29, 2024 and sell it today you would earn a total of 40,254,700 from holding Samyang Foods Co or generate 345.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samyang Foods Co vs. BGF Retail Co
Performance |
| Timeline |
| Samyang Foods |
| BGF Retail |
Samyang Foods and BGF Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyang Foods and BGF Retail
The main advantage of trading using opposite Samyang Foods and BGF Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyang Foods position performs unexpectedly, BGF Retail 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 BGF Retail will offset losses from the drop in BGF Retail's long position.| Samyang Foods vs. AptaBio Therapeutics | Samyang Foods vs. Daewoo SBI SPAC | Samyang Foods vs. Dream Security co | Samyang Foods vs. Microfriend |
| BGF Retail vs. AptaBio Therapeutics | BGF Retail vs. Daewoo SBI SPAC | BGF Retail vs. Dream Security co | BGF Retail 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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