Correlation Between Korea Shipbuilding and Sajo Seafood
Can any of the company-specific risk be diversified away by investing in both Korea Shipbuilding and Sajo Seafood 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 Korea Shipbuilding and Sajo Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Shipbuilding Offshore and Sajo Seafood, you can compare the effects of market volatilities on Korea Shipbuilding and Sajo Seafood 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 Korea Shipbuilding with a short position of Sajo Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Shipbuilding and Sajo Seafood.
Diversification Opportunities for Korea Shipbuilding and Sajo Seafood
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Korea and Sajo is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Korea Shipbuilding Offshore and Sajo Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sajo Seafood and Korea Shipbuilding 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 Korea Shipbuilding Offshore are associated (or correlated) with Sajo Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sajo Seafood has no effect on the direction of Korea Shipbuilding i.e., Korea Shipbuilding and Sajo Seafood go up and down completely randomly.
Pair Corralation between Korea Shipbuilding and Sajo Seafood
Assuming the 90 days trading horizon Korea Shipbuilding is expected to generate 29.64 times less return on investment than Sajo Seafood. But when comparing it to its historical volatility, Korea Shipbuilding Offshore is 3.03 times less risky than Sajo Seafood. It trades about 0.02 of its potential returns per unit of risk. Sajo Seafood is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 449,000 in Sajo Seafood on November 3, 2024 and sell it today you would earn a total of 119,000 from holding Sajo Seafood or generate 26.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Shipbuilding Offshore vs. Sajo Seafood
Performance |
| Timeline |
| Korea Shipbuilding |
| Sajo Seafood |
Korea Shipbuilding and Sajo Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Shipbuilding and Sajo Seafood
The main advantage of trading using opposite Korea Shipbuilding and Sajo Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Shipbuilding position performs unexpectedly, Sajo Seafood 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 Sajo Seafood will offset losses from the drop in Sajo Seafood's long position.| Korea Shipbuilding vs. Woori Technology Investment | Korea Shipbuilding vs. Barunson Entertainment Arts | Korea Shipbuilding vs. SAMG Entertainment Co | Korea Shipbuilding vs. SBI Investment KOREA |
| Sajo Seafood vs. Ssangyong Information Communication | Sajo Seafood vs. Echomarketing CoLtd | Sajo Seafood vs. Dongbang Transport Logistics | Sajo Seafood vs. Hanwha Life Insurance |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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