Correlation Between Moonbae Steel and Seojin Automotive
Can any of the company-specific risk be diversified away by investing in both Moonbae Steel and Seojin Automotive 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 Moonbae Steel and Seojin Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moonbae Steel and Seojin Automotive CoLtd, you can compare the effects of market volatilities on Moonbae Steel and Seojin Automotive 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 Moonbae Steel with a short position of Seojin Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moonbae Steel and Seojin Automotive.
Diversification Opportunities for Moonbae Steel and Seojin Automotive
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Moonbae and Seojin is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Moonbae Steel and Seojin Automotive CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seojin Automotive CoLtd and Moonbae 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 Moonbae Steel are associated (or correlated) with Seojin Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seojin Automotive CoLtd has no effect on the direction of Moonbae Steel i.e., Moonbae Steel and Seojin Automotive go up and down completely randomly.
Pair Corralation between Moonbae Steel and Seojin Automotive
Assuming the 90 days trading horizon Moonbae Steel is expected to generate 0.78 times more return on investment than Seojin Automotive. However, Moonbae Steel is 1.28 times less risky than Seojin Automotive. It trades about -0.04 of its potential returns per unit of risk. Seojin Automotive CoLtd is currently generating about -0.08 per unit of risk. If you would invest 305,016 in Moonbae Steel on September 12, 2024 and sell it today you would lose (82,016) from holding Moonbae Steel or give up 26.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Moonbae Steel vs. Seojin Automotive CoLtd
Performance |
| Timeline |
| Moonbae Steel |
| Seojin Automotive CoLtd |
Moonbae Steel and Seojin Automotive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Moonbae Steel and Seojin Automotive
The main advantage of trading using opposite Moonbae Steel and Seojin Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moonbae Steel position performs unexpectedly, Seojin Automotive 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 Seojin Automotive will offset losses from the drop in Seojin Automotive's long position.| Moonbae Steel vs. LG Chemicals | Moonbae Steel vs. POSCO Holdings | Moonbae Steel vs. Hanwha Solutions | Moonbae Steel vs. Lotte Chemical Corp |
| Seojin Automotive vs. Innowireless Co | Seojin Automotive vs. Moonbae Steel | Seojin Automotive vs. Fine Besteel Co | Seojin Automotive vs. Jeil Steel Mfg |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |