Correlation Between Samlip General and Leaders Technology
Can any of the company-specific risk be diversified away by investing in both Samlip General and Leaders Technology 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 Samlip General and Leaders Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samlip General Foods and Leaders Technology Investment, you can compare the effects of market volatilities on Samlip General and Leaders Technology 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 Samlip General with a short position of Leaders Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and Leaders Technology.
Diversification Opportunities for Samlip General and Leaders Technology
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samlip and Leaders is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and Leaders Technology Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leaders Technology and Samlip General 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 Samlip General Foods are associated (or correlated) with Leaders Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leaders Technology has no effect on the direction of Samlip General i.e., Samlip General and Leaders Technology go up and down completely randomly.
Pair Corralation between Samlip General and Leaders Technology
Assuming the 90 days trading horizon Samlip General Foods is expected to generate 0.66 times more return on investment than Leaders Technology. However, Samlip General Foods is 1.51 times less risky than Leaders Technology. It trades about 0.16 of its potential returns per unit of risk. Leaders Technology Investment is currently generating about 0.04 per unit of risk. If you would invest 4,747,290 in Samlip General Foods on October 14, 2024 and sell it today you would earn a total of 332,710 from holding Samlip General Foods or generate 7.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samlip General Foods vs. Leaders Technology Investment
Performance |
| Timeline |
| Samlip General Foods |
| Leaders Technology |
Samlip General and Leaders Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samlip General and Leaders Technology
The main advantage of trading using opposite Samlip General and Leaders Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samlip General position performs unexpectedly, Leaders Technology 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 Leaders Technology will offset losses from the drop in Leaders Technology's long position.| Samlip General vs. LG Chemicals | Samlip General vs. Daejung Chemicals Metals | Samlip General vs. Nam Hwa Construction | Samlip General vs. Miwon Chemicals Co |
| Leaders Technology vs. Samlip General Foods | Leaders Technology vs. Sam Yang Foods | Leaders Technology vs. Daejung Chemicals Metals | Leaders Technology vs. Sajo Seafood |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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