Correlation Between Korean Reinsurance and Sangsangin Investment
Can any of the company-specific risk be diversified away by investing in both Korean Reinsurance and Sangsangin Investment 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 Korean Reinsurance and Sangsangin Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korean Reinsurance Co and Sangsangin Investment Securities, you can compare the effects of market volatilities on Korean Reinsurance and Sangsangin Investment 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 Korean Reinsurance with a short position of Sangsangin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korean Reinsurance and Sangsangin Investment.
Diversification Opportunities for Korean Reinsurance and Sangsangin Investment
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Korean and Sangsangin is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Korean Reinsurance Co and Sangsangin Investment Securiti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangsangin Investment and Korean Reinsurance 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 Korean Reinsurance Co are associated (or correlated) with Sangsangin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sangsangin Investment has no effect on the direction of Korean Reinsurance i.e., Korean Reinsurance and Sangsangin Investment go up and down completely randomly.
Pair Corralation between Korean Reinsurance and Sangsangin Investment
Assuming the 90 days trading horizon Korean Reinsurance Co is expected to generate 0.84 times more return on investment than Sangsangin Investment. However, Korean Reinsurance Co is 1.19 times less risky than Sangsangin Investment. It trades about -0.01 of its potential returns per unit of risk. Sangsangin Investment Securities is currently generating about -0.05 per unit of risk. If you would invest 824,000 in Korean Reinsurance Co on November 27, 2024 and sell it today you would lose (2,000) from holding Korean Reinsurance Co or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korean Reinsurance Co vs. Sangsangin Investment Securiti
Performance |
| Timeline |
| Korean Reinsurance |
| Sangsangin Investment |
Korean Reinsurance and Sangsangin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korean Reinsurance and Sangsangin Investment
The main advantage of trading using opposite Korean Reinsurance and Sangsangin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korean Reinsurance position performs unexpectedly, Sangsangin Investment 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 Sangsangin Investment will offset losses from the drop in Sangsangin Investment's long position.| Korean Reinsurance vs. Worldex Industry Trading | Korean Reinsurance vs. E Investment Development | Korean Reinsurance vs. Nh Investment And | Korean Reinsurance vs. SBI Investment KOREA |
| Sangsangin Investment vs. FNSTech Co | Sangsangin Investment vs. Hanyang Digitech Co | Sangsangin Investment vs. Korean Reinsurance Co | Sangsangin Investment vs. Spolytech Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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