Correlation Between Ni Steel and Samwon Steel
Can any of the company-specific risk be diversified away by investing in both Ni Steel and Samwon Steel 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 Ni Steel and Samwon Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ni Steel and Samwon Steel, you can compare the effects of market volatilities on Ni Steel and Samwon Steel 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 Ni Steel with a short position of Samwon Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ni Steel and Samwon Steel.
Diversification Opportunities for Ni Steel and Samwon Steel
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 008260 and Samwon is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Ni Steel and Samwon Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samwon Steel and Ni Steel 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 Ni Steel are associated (or correlated) with Samwon Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samwon Steel has no effect on the direction of Ni Steel i.e., Ni Steel and Samwon Steel go up and down completely randomly.
Pair Corralation between Ni Steel and Samwon Steel
Assuming the 90 days trading horizon Ni Steel is expected to generate 1.01 times more return on investment than Samwon Steel. However, Ni Steel is 1.01 times more volatile than Samwon Steel. It trades about 0.13 of its potential returns per unit of risk. Samwon Steel is currently generating about 0.01 per unit of risk. If you would invest 341,000 in Ni Steel on November 3, 2024 and sell it today you would earn a total of 11,500 from holding Ni Steel or generate 3.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ni Steel vs. Samwon Steel
Performance |
| Timeline |
| Ni Steel |
| Samwon Steel |
Ni Steel and Samwon Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ni Steel and Samwon Steel
The main advantage of trading using opposite Ni Steel and Samwon Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ni Steel position performs unexpectedly, Samwon Steel 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 Samwon Steel will offset losses from the drop in Samwon Steel's long position.| Ni Steel vs. DB Insurance Co | Ni Steel vs. Cuckoo Electronics Co | Ni Steel vs. Jeju Bank | Ni Steel vs. Settlebank |
| Samwon Steel vs. Digital Imaging Technology | Samwon Steel vs. Ilji Technology Co | Samwon Steel vs. Bosung Power Technology | Samwon Steel vs. GS Retail 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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |