Correlation Between Samyoung Electronics and Seoul Electronics
Can any of the company-specific risk be diversified away by investing in both Samyoung Electronics and Seoul Electronics 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 Samyoung Electronics and Seoul Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samyoung Electronics Co and Seoul Electronics Telecom, you can compare the effects of market volatilities on Samyoung Electronics and Seoul Electronics 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 Samyoung Electronics with a short position of Seoul Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyoung Electronics and Seoul Electronics.
Diversification Opportunities for Samyoung Electronics and Seoul Electronics
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Samyoung and Seoul is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Samyoung Electronics Co and Seoul Electronics Telecom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seoul Electronics Telecom and Samyoung Electronics 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 Samyoung Electronics Co are associated (or correlated) with Seoul Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seoul Electronics Telecom has no effect on the direction of Samyoung Electronics i.e., Samyoung Electronics and Seoul Electronics go up and down completely randomly.
Pair Corralation between Samyoung Electronics and Seoul Electronics
Assuming the 90 days trading horizon Samyoung Electronics Co is expected to generate 0.32 times more return on investment than Seoul Electronics. However, Samyoung Electronics Co is 3.12 times less risky than Seoul Electronics. It trades about 0.28 of its potential returns per unit of risk. Seoul Electronics Telecom is currently generating about 0.05 per unit of risk. If you would invest 993,000 in Samyoung Electronics Co on November 3, 2024 and sell it today you would earn a total of 54,000 from holding Samyoung Electronics Co or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samyoung Electronics Co vs. Seoul Electronics Telecom
Performance |
| Timeline |
| Samyoung Electronics |
| Seoul Electronics Telecom |
Samyoung Electronics and Seoul Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyoung Electronics and Seoul Electronics
The main advantage of trading using opposite Samyoung Electronics and Seoul Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyoung Electronics position performs unexpectedly, Seoul Electronics 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 Seoul Electronics will offset losses from the drop in Seoul Electronics' long position.| Samyoung Electronics vs. DSC Investment | Samyoung Electronics vs. Korea Investment Holdings | Samyoung Electronics vs. Golden Bridge Investment | Samyoung Electronics vs. Haitai Confectionery Foods |
| Seoul Electronics vs. MetaLabs Co | Seoul Electronics vs. Youngsin Metal Industrial | Seoul Electronics vs. DONGKUK TED METAL | Seoul Electronics vs. Shinhan Inverse Copper |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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