Correlation Between Songwon Industrial and Sk Biopharmaceutica
Can any of the company-specific risk be diversified away by investing in both Songwon Industrial and Sk Biopharmaceutica 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 Sk Biopharmaceutica 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 Sk Biopharmaceuticals Co, you can compare the effects of market volatilities on Songwon Industrial and Sk Biopharmaceutica 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 Sk Biopharmaceutica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Songwon Industrial and Sk Biopharmaceutica.
Diversification Opportunities for Songwon Industrial and Sk Biopharmaceutica
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Songwon and 326030 is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Songwon Industrial Co and Sk Biopharmaceuticals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sk Biopharmaceuticals 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 Sk Biopharmaceutica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sk Biopharmaceuticals has no effect on the direction of Songwon Industrial i.e., Songwon Industrial and Sk Biopharmaceutica go up and down completely randomly.
Pair Corralation between Songwon Industrial and Sk Biopharmaceutica
Assuming the 90 days trading horizon Songwon Industrial Co is expected to generate 1.59 times more return on investment than Sk Biopharmaceutica. However, Songwon Industrial is 1.59 times more volatile than Sk Biopharmaceuticals Co. It trades about 0.05 of its potential returns per unit of risk. Sk Biopharmaceuticals Co is currently generating about -0.03 per unit of risk. If you would invest 1,136,000 in Songwon Industrial Co on November 6, 2024 and sell it today you would earn a total of 24,000 from holding Songwon Industrial Co or generate 2.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.44% |
| Values | Daily Returns |
Songwon Industrial Co vs. Sk Biopharmaceuticals Co
Performance |
| Timeline |
| Songwon Industrial |
| Sk Biopharmaceuticals |
Songwon Industrial and Sk Biopharmaceutica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Songwon Industrial and Sk Biopharmaceutica
The main advantage of trading using opposite Songwon Industrial and Sk Biopharmaceutica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Songwon Industrial position performs unexpectedly, Sk Biopharmaceutica 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 Sk Biopharmaceutica will offset losses from the drop in Sk Biopharmaceutica's long position.| Songwon Industrial vs. AptaBio Therapeutics | Songwon Industrial vs. Daewoo SBI SPAC | Songwon Industrial vs. Dream Security co | Songwon Industrial vs. Microfriend |
| Sk Biopharmaceutica vs. Samsung Biologics Co | Sk Biopharmaceutica vs. SK Bioscience Co | Sk Biopharmaceutica vs. ABL Bio | Sk Biopharmaceutica vs. Green Cross Lab |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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