Correlation Between GS Engineering and SBI Investment
Can any of the company-specific risk be diversified away by investing in both GS Engineering and SBI Investment 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 GS Engineering and SBI Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GS Engineering Construction and SBI Investment KOREA, you can compare the effects of market volatilities on GS Engineering and SBI Investment 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 GS Engineering with a short position of SBI Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of GS Engineering and SBI Investment.
Diversification Opportunities for GS Engineering and SBI Investment
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 006360 and SBI is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding GS Engineering Construction and SBI Investment KOREA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Investment KOREA and GS Engineering 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 GS Engineering Construction are associated (or correlated) with SBI Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Investment KOREA has no effect on the direction of GS Engineering i.e., GS Engineering and SBI Investment go up and down completely randomly.
Pair Corralation between GS Engineering and SBI Investment
Assuming the 90 days trading horizon GS Engineering Construction is expected to generate 1.03 times more return on investment than SBI Investment. However, GS Engineering is 1.03 times more volatile than SBI Investment KOREA. It trades about 0.01 of its potential returns per unit of risk. SBI Investment KOREA is currently generating about -0.04 per unit of risk. If you would invest 1,984,170 in GS Engineering Construction on August 29, 2024 and sell it today you would lose (6,170) from holding GS Engineering Construction or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GS Engineering Construction vs. SBI Investment KOREA
Performance |
| Timeline |
| GS Engineering Const |
| SBI Investment KOREA |
GS Engineering and SBI Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GS Engineering and SBI Investment
The main advantage of trading using opposite GS Engineering and SBI Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GS Engineering position performs unexpectedly, SBI Investment 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 SBI Investment will offset losses from the drop in SBI Investment's long position.| GS Engineering vs. AptaBio Therapeutics | GS Engineering vs. Daewoo SBI SPAC | GS Engineering vs. Dream Security co | GS Engineering vs. Microfriend |
| SBI Investment vs. Daekyung Machinery Engineering | SBI Investment vs. PlayD Co | SBI Investment vs. Playgram Co | SBI Investment vs. Camus Engineering Construction |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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