Correlation Between Songwon Industrial and Playgram
Can any of the company-specific risk be diversified away by investing in both Songwon Industrial and Playgram 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 Songwon Industrial and Playgram into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Songwon Industrial Co and Playgram Co, you can compare the effects of market volatilities on Songwon Industrial and Playgram 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 Songwon Industrial with a short position of Playgram. Check out your portfolio center. Please also check ongoing floating volatility patterns of Songwon Industrial and Playgram.
Diversification Opportunities for Songwon Industrial and Playgram
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Songwon and Playgram is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Songwon Industrial Co and Playgram Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Playgram and Songwon Industrial 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 Songwon Industrial Co are associated (or correlated) with Playgram. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Playgram has no effect on the direction of Songwon Industrial i.e., Songwon Industrial and Playgram go up and down completely randomly.
Pair Corralation between Songwon Industrial and Playgram
Assuming the 90 days trading horizon Songwon Industrial is expected to generate 2.07 times less return on investment than Playgram. But when comparing it to its historical volatility, Songwon Industrial Co is 1.96 times less risky than Playgram. It trades about 0.15 of its potential returns per unit of risk. Playgram Co is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 31,100 in Playgram Co on October 16, 2024 and sell it today you would earn a total of 9,300 from holding Playgram Co or generate 29.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Songwon Industrial Co vs. Playgram Co
Performance |
| Timeline |
| Songwon Industrial |
| Playgram |
Songwon Industrial and Playgram Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Songwon Industrial and Playgram
The main advantage of trading using opposite Songwon Industrial and Playgram positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Songwon Industrial position performs unexpectedly, Playgram 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 Playgram will offset losses from the drop in Playgram's long position.| Songwon Industrial vs. DB Insurance Co | Songwon Industrial vs. TS Investment Corp | Songwon Industrial vs. Shinhan Financial Group | Songwon Industrial vs. SV Investment |
| Playgram vs. Songwon Industrial Co | Playgram vs. NICE Information Service | Playgram vs. Daou Data Corp | Playgram vs. Sam Yang Foods |
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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