Correlation Between Mirae Asset and Shinhan Inverse
Can any of the company-specific risk be diversified away by investing in both Mirae Asset and Shinhan Inverse 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 Mirae Asset and Shinhan Inverse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mirae Asset Daewoo and Shinhan Inverse Dollar, you can compare the effects of market volatilities on Mirae Asset and Shinhan Inverse 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 Mirae Asset with a short position of Shinhan Inverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirae Asset and Shinhan Inverse.
Diversification Opportunities for Mirae Asset and Shinhan Inverse
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mirae and Shinhan is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Mirae Asset Daewoo and Shinhan Inverse Dollar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Inverse Dollar and Mirae Asset 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 Mirae Asset Daewoo are associated (or correlated) with Shinhan Inverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Inverse Dollar has no effect on the direction of Mirae Asset i.e., Mirae Asset and Shinhan Inverse go up and down completely randomly.
Pair Corralation between Mirae Asset and Shinhan Inverse
Assuming the 90 days trading horizon Mirae Asset Daewoo is expected to generate 4.75 times more return on investment than Shinhan Inverse. However, Mirae Asset is 4.75 times more volatile than Shinhan Inverse Dollar. It trades about -0.02 of its potential returns per unit of risk. Shinhan Inverse Dollar is currently generating about -0.25 per unit of risk. If you would invest 434,000 in Mirae Asset Daewoo on October 9, 2024 and sell it today you would lose (4,000) from holding Mirae Asset Daewoo or give up 0.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mirae Asset Daewoo vs. Shinhan Inverse Dollar
Performance |
| Timeline |
| Mirae Asset Daewoo |
| Shinhan Inverse Dollar |
Mirae Asset and Shinhan Inverse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mirae Asset and Shinhan Inverse
The main advantage of trading using opposite Mirae Asset and Shinhan Inverse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirae Asset position performs unexpectedly, Shinhan Inverse 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 Shinhan Inverse will offset losses from the drop in Shinhan Inverse's long position.| Mirae Asset vs. Woorim Machinery Co | Mirae Asset vs. Shinsegae Engineering Construction | Mirae Asset vs. Lotte Data Communication | Mirae Asset vs. Seohee Construction Co |
| Shinhan Inverse vs. Busan Industrial Co | Shinhan Inverse vs. Busan Ind | Shinhan Inverse vs. Mirae Asset Daewoo | Shinhan Inverse vs. UNISEM Co |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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