Correlation Between KyungIn Electronics and SK Telecom
Can any of the company-specific risk be diversified away by investing in both KyungIn Electronics and SK Telecom 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 KyungIn Electronics and SK Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KyungIn Electronics Co and SK Telecom Co, you can compare the effects of market volatilities on KyungIn Electronics and SK Telecom 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 KyungIn Electronics with a short position of SK Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of KyungIn Electronics and SK Telecom.
Diversification Opportunities for KyungIn Electronics and SK Telecom
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KyungIn and 017670 is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding KyungIn Electronics Co and SK Telecom Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Telecom and KyungIn 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 KyungIn Electronics Co are associated (or correlated) with SK Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Telecom has no effect on the direction of KyungIn Electronics i.e., KyungIn Electronics and SK Telecom go up and down completely randomly.
Pair Corralation between KyungIn Electronics and SK Telecom
Assuming the 90 days trading horizon KyungIn Electronics Co is expected to under-perform the SK Telecom. In addition to that, KyungIn Electronics is 3.15 times more volatile than SK Telecom Co. It trades about 0.0 of its total potential returns per unit of risk. SK Telecom Co is currently generating about 0.09 per unit of volatility. If you would invest 4,143,708 in SK Telecom Co on August 28, 2024 and sell it today you would earn a total of 1,536,292 from holding SK Telecom Co or generate 37.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KyungIn Electronics Co vs. SK Telecom Co
Performance |
| Timeline |
| KyungIn Electronics |
| SK Telecom |
KyungIn Electronics and SK Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KyungIn Electronics and SK Telecom
The main advantage of trading using opposite KyungIn Electronics and SK Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KyungIn Electronics position performs unexpectedly, SK Telecom 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 SK Telecom will offset losses from the drop in SK Telecom's long position.| KyungIn Electronics vs. FOODWELL Co | KyungIn Electronics vs. Organic Special Pet | KyungIn Electronics vs. CJ Seafood Corp | KyungIn Electronics vs. CJ Seafood Corp |
| SK Telecom vs. Barunson Entertainment Arts | SK Telecom vs. Derkwoo Electronics Co | SK Telecom vs. Tamul Multimedia Co | SK Telecom vs. SM Entertainment 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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