Correlation Between Samyang Foods and KakaoBank Corp
Can any of the company-specific risk be diversified away by investing in both Samyang Foods and KakaoBank Corp 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 KakaoBank Corp 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 KakaoBank Corp, you can compare the effects of market volatilities on Samyang Foods and KakaoBank Corp 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 KakaoBank Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyang Foods and KakaoBank Corp.
Diversification Opportunities for Samyang Foods and KakaoBank Corp
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Samyang and KakaoBank is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Samyang Foods Co and KakaoBank Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KakaoBank Corp 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 KakaoBank Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KakaoBank Corp has no effect on the direction of Samyang Foods i.e., Samyang Foods and KakaoBank Corp go up and down completely randomly.
Pair Corralation between Samyang Foods and KakaoBank Corp
Assuming the 90 days trading horizon Samyang Foods is expected to generate 3.39 times less return on investment than KakaoBank Corp. In addition to that, Samyang Foods is 1.86 times more volatile than KakaoBank Corp. It trades about 0.01 of its total potential returns per unit of risk. KakaoBank Corp is currently generating about 0.09 per unit of volatility. If you would invest 2,165,000 in KakaoBank Corp on September 1, 2024 and sell it today you would earn a total of 70,000 from holding KakaoBank Corp or generate 3.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samyang Foods Co vs. KakaoBank Corp
Performance |
| Timeline |
| Samyang Foods |
| KakaoBank Corp |
Samyang Foods and KakaoBank Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyang Foods and KakaoBank Corp
The main advantage of trading using opposite Samyang Foods and KakaoBank Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyang Foods position performs unexpectedly, KakaoBank Corp 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 KakaoBank Corp will offset losses from the drop in KakaoBank Corp's long position.| Samyang Foods vs. AptaBio Therapeutics | Samyang Foods vs. Daewoo SBI SPAC | Samyang Foods vs. Dream Security co | Samyang Foods vs. Microfriend |
| KakaoBank Corp vs. Shinhan Financial Group | KakaoBank Corp vs. Hana Financial | KakaoBank Corp vs. Woori Financial Group | KakaoBank Corp vs. Industrial Bank |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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