Correlation Between Samlip General and Cloud Air
Can any of the company-specific risk be diversified away by investing in both Samlip General and Cloud Air 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 Cloud Air 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 Cloud Air CoLtd, you can compare the effects of market volatilities on Samlip General and Cloud Air 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 Cloud Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and Cloud Air.
Diversification Opportunities for Samlip General and Cloud Air
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samlip and Cloud is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and Cloud Air CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cloud Air CoLtd 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 Cloud Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cloud Air CoLtd has no effect on the direction of Samlip General i.e., Samlip General and Cloud Air go up and down completely randomly.
Pair Corralation between Samlip General and Cloud Air
Assuming the 90 days trading horizon Samlip General Foods is expected to generate 0.91 times more return on investment than Cloud Air. However, Samlip General Foods is 1.1 times less risky than Cloud Air. It trades about 0.02 of its potential returns per unit of risk. Cloud Air CoLtd is currently generating about -0.02 per unit of risk. If you would invest 4,690,000 in Samlip General Foods on September 13, 2024 and sell it today you would earn a total of 30,000 from holding Samlip General Foods or generate 0.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samlip General Foods vs. Cloud Air CoLtd
Performance |
| Timeline |
| Samlip General Foods |
| Cloud Air CoLtd |
Samlip General and Cloud Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samlip General and Cloud Air
The main advantage of trading using opposite Samlip General and Cloud Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samlip General position performs unexpectedly, Cloud Air 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 Cloud Air will offset losses from the drop in Cloud Air's long position.| Samlip General vs. Hana Financial | Samlip General vs. Koryo Credit Information | Samlip General vs. InfoBank | Samlip General vs. KB Financial Group |
| Cloud Air vs. SK Hynix | Cloud Air vs. People Technology | Cloud Air vs. Hana Materials | Cloud Air vs. SIMMTECH Co |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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