Correlation Between Samlip General and SEOWONINTECHCoLtd
Can any of the company-specific risk be diversified away by investing in both Samlip General and SEOWONINTECHCoLtd 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 SEOWONINTECHCoLtd 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 SEOWONINTECHCoLtd, you can compare the effects of market volatilities on Samlip General and SEOWONINTECHCoLtd 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 SEOWONINTECHCoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and SEOWONINTECHCoLtd.
Diversification Opportunities for Samlip General and SEOWONINTECHCoLtd
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samlip and SEOWONINTECHCoLtd is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and SEOWONINTECHCoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEOWONINTECHCoLtd 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 SEOWONINTECHCoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEOWONINTECHCoLtd has no effect on the direction of Samlip General i.e., Samlip General and SEOWONINTECHCoLtd go up and down completely randomly.
Pair Corralation between Samlip General and SEOWONINTECHCoLtd
Assuming the 90 days trading horizon Samlip General Foods is expected to under-perform the SEOWONINTECHCoLtd. In addition to that, Samlip General is 3.66 times more volatile than SEOWONINTECHCoLtd. It trades about -0.13 of its total potential returns per unit of risk. SEOWONINTECHCoLtd is currently generating about -0.13 per unit of volatility. If you would invest 547,000 in SEOWONINTECHCoLtd on October 30, 2024 and sell it today you would lose (9,000) from holding SEOWONINTECHCoLtd or give up 1.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samlip General Foods vs. SEOWONINTECHCoLtd
Performance |
| Timeline |
| Samlip General Foods |
| SEOWONINTECHCoLtd |
Samlip General and SEOWONINTECHCoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samlip General and SEOWONINTECHCoLtd
The main advantage of trading using opposite Samlip General and SEOWONINTECHCoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samlip General position performs unexpectedly, SEOWONINTECHCoLtd 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 SEOWONINTECHCoLtd will offset losses from the drop in SEOWONINTECHCoLtd's long position.| Samlip General vs. CKH Food Health | Samlip General vs. Cuckoo Homesys Co | Samlip General vs. Sempio Foods Co | Samlip General vs. Homecast CoLtd |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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