Correlation Between Daehan Synthetic and Shinsegae Information
Can any of the company-specific risk be diversified away by investing in both Daehan Synthetic and Shinsegae Information 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 Daehan Synthetic and Shinsegae Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daehan Synthetic Fiber and Shinsegae Information Communication, you can compare the effects of market volatilities on Daehan Synthetic and Shinsegae Information 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 Daehan Synthetic with a short position of Shinsegae Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daehan Synthetic and Shinsegae Information.
Diversification Opportunities for Daehan Synthetic and Shinsegae Information
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daehan and Shinsegae is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Daehan Synthetic Fiber and Shinsegae Information Communic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinsegae Information and Daehan Synthetic 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 Daehan Synthetic Fiber are associated (or correlated) with Shinsegae Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinsegae Information has no effect on the direction of Daehan Synthetic i.e., Daehan Synthetic and Shinsegae Information go up and down completely randomly.
Pair Corralation between Daehan Synthetic and Shinsegae Information
Assuming the 90 days trading horizon Daehan Synthetic Fiber is expected to generate 0.75 times more return on investment than Shinsegae Information. However, Daehan Synthetic Fiber is 1.33 times less risky than Shinsegae Information. It trades about -0.01 of its potential returns per unit of risk. Shinsegae Information Communication is currently generating about -0.09 per unit of risk. If you would invest 11,420,000 in Daehan Synthetic Fiber on September 12, 2024 and sell it today you would lose (320,000) from holding Daehan Synthetic Fiber or give up 2.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daehan Synthetic Fiber vs. Shinsegae Information Communic
Performance |
| Timeline |
| Daehan Synthetic Fiber |
| Shinsegae Information |
Daehan Synthetic and Shinsegae Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daehan Synthetic and Shinsegae Information
The main advantage of trading using opposite Daehan Synthetic and Shinsegae Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daehan Synthetic position performs unexpectedly, Shinsegae Information 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 Shinsegae Information will offset losses from the drop in Shinsegae Information's long position.| Daehan Synthetic vs. Samsung Electronics Co | Daehan Synthetic vs. Samsung Electronics Co | Daehan Synthetic vs. SK Hynix | Daehan Synthetic vs. POSCO Holdings |
| Shinsegae Information vs. Samsung Electronics Co | Shinsegae Information vs. Samsung Electronics Co | Shinsegae Information vs. SK Hynix | Shinsegae Information vs. POSCO Holdings |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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