Correlation Between Samlip General and Raontech
Can any of the company-specific risk be diversified away by investing in both Samlip General and Raontech 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 Raontech 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 Raontech, you can compare the effects of market volatilities on Samlip General and Raontech 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 Raontech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and Raontech.
Diversification Opportunities for Samlip General and Raontech
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samlip and Raontech is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and Raontech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raontech 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 Raontech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raontech has no effect on the direction of Samlip General i.e., Samlip General and Raontech go up and down completely randomly.
Pair Corralation between Samlip General and Raontech
Assuming the 90 days trading horizon Samlip General is expected to generate 2.98 times less return on investment than Raontech. But when comparing it to its historical volatility, Samlip General Foods is 1.78 times less risky than Raontech. It trades about 0.28 of its potential returns per unit of risk. Raontech is currently generating about 0.46 of returns per unit of risk over similar time horizon. If you would invest 259,000 in Raontech on October 11, 2024 and sell it today you would earn a total of 117,500 from holding Raontech or generate 45.37% 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. Raontech
Performance |
| Timeline |
| Samlip General Foods |
| Raontech |
Samlip General and Raontech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samlip General and Raontech
The main advantage of trading using opposite Samlip General and Raontech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samlip General position performs unexpectedly, Raontech 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 Raontech will offset losses from the drop in Raontech's long position.| Samlip General vs. Dongbang Transport Logistics | Samlip General vs. KMH Hitech Co | Samlip General vs. V One Tech Co | Samlip General vs. Raontech |
| Raontech vs. Samlip General Foods | Raontech vs. Daol Investment Securities | Raontech vs. Atinum Investment Co | Raontech vs. JYP Entertainment Corp |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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