Correlation Between SGC Energy and Ssangyong Information
Can any of the company-specific risk be diversified away by investing in both SGC Energy and Ssangyong 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 SGC Energy and Ssangyong Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SGC Energy Co and Ssangyong Information Communication, you can compare the effects of market volatilities on SGC Energy and Ssangyong 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 SGC Energy with a short position of Ssangyong Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of SGC Energy and Ssangyong Information.
Diversification Opportunities for SGC Energy and Ssangyong Information
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between SGC and Ssangyong is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding SGC Energy Co and Ssangyong Information Communic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ssangyong Information and SGC Energy 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 SGC Energy Co are associated (or correlated) with Ssangyong Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ssangyong Information has no effect on the direction of SGC Energy i.e., SGC Energy and Ssangyong Information go up and down completely randomly.
Pair Corralation between SGC Energy and Ssangyong Information
Assuming the 90 days trading horizon SGC Energy Co is expected to generate 0.97 times more return on investment than Ssangyong Information. However, SGC Energy Co is 1.03 times less risky than Ssangyong Information. It trades about -0.01 of its potential returns per unit of risk. Ssangyong Information Communication is currently generating about -0.03 per unit of risk. If you would invest 2,971,153 in SGC Energy Co on September 3, 2024 and sell it today you would lose (421,153) from holding SGC Energy Co or give up 14.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SGC Energy Co vs. Ssangyong Information Communic
Performance |
| Timeline |
| SGC Energy |
| Ssangyong Information |
SGC Energy and Ssangyong Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SGC Energy and Ssangyong Information
The main advantage of trading using opposite SGC Energy and Ssangyong Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SGC Energy position performs unexpectedly, Ssangyong 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 Ssangyong Information will offset losses from the drop in Ssangyong Information's long position.| SGC Energy vs. FNC Entertainment Co | SGC Energy vs. Next Entertainment World | SGC Energy vs. Homecast CoLtd | SGC Energy vs. Home Center Holdings |
| Ssangyong Information vs. SBI Investment KOREA | Ssangyong Information vs. Jeju Beer Co | Ssangyong Information vs. Coloray International Investment | Ssangyong Information vs. NH Investment Securities |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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