Correlation Between Samlip General and Lion Chemtech
Can any of the company-specific risk be diversified away by investing in both Samlip General and Lion Chemtech 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 Lion Chemtech 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 Lion Chemtech Co, you can compare the effects of market volatilities on Samlip General and Lion Chemtech 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 Lion Chemtech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and Lion Chemtech.
Diversification Opportunities for Samlip General and Lion Chemtech
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samlip and Lion is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and Lion Chemtech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Chemtech 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 Lion Chemtech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Chemtech has no effect on the direction of Samlip General i.e., Samlip General and Lion Chemtech go up and down completely randomly.
Pair Corralation between Samlip General and Lion Chemtech
Assuming the 90 days trading horizon Samlip General Foods is expected to generate 0.71 times more return on investment than Lion Chemtech. However, Samlip General Foods is 1.4 times less risky than Lion Chemtech. It trades about -0.12 of its potential returns per unit of risk. Lion Chemtech Co is currently generating about -0.1 per unit of risk. If you would invest 4,965,000 in Samlip General Foods on September 1, 2024 and sell it today you would lose (255,000) from holding Samlip General Foods or give up 5.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samlip General Foods vs. Lion Chemtech Co
Performance |
| Timeline |
| Samlip General Foods |
| Lion Chemtech |
Samlip General and Lion Chemtech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samlip General and Lion Chemtech
The main advantage of trading using opposite Samlip General and Lion Chemtech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samlip General position performs unexpectedly, Lion Chemtech 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 Lion Chemtech will offset losses from the drop in Lion Chemtech's long position.| Samlip General vs. AptaBio Therapeutics | Samlip General vs. Daewoo SBI SPAC | Samlip General vs. Dream Security co | Samlip General vs. Microfriend |
| Lion Chemtech vs. Amogreentech Co | Lion Chemtech vs. Bookook Steel | Lion Chemtech vs. Konan Technology | Lion Chemtech vs. Hankuk Steel Wire |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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