Correlation Between Ssangyong Information and KT Hitel
Can any of the company-specific risk be diversified away by investing in both Ssangyong Information and KT Hitel 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 Ssangyong Information and KT Hitel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ssangyong Information Communication and KT Hitel, you can compare the effects of market volatilities on Ssangyong Information and KT Hitel 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 Ssangyong Information with a short position of KT Hitel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssangyong Information and KT Hitel.
Diversification Opportunities for Ssangyong Information and KT Hitel
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ssangyong and 036030 is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Ssangyong Information Communic and KT Hitel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Hitel and Ssangyong Information 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 Ssangyong Information Communication are associated (or correlated) with KT Hitel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Hitel has no effect on the direction of Ssangyong Information i.e., Ssangyong Information and KT Hitel go up and down completely randomly.
Pair Corralation between Ssangyong Information and KT Hitel
Assuming the 90 days trading horizon Ssangyong Information Communication is expected to generate 0.81 times more return on investment than KT Hitel. However, Ssangyong Information Communication is 1.24 times less risky than KT Hitel. It trades about 0.12 of its potential returns per unit of risk. KT Hitel is currently generating about -0.22 per unit of risk. If you would invest 60,300 in Ssangyong Information Communication on September 3, 2024 and sell it today you would earn a total of 1,700 from holding Ssangyong Information Communication or generate 2.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ssangyong Information Communic vs. KT Hitel
Performance |
| Timeline |
| Ssangyong Information |
| KT Hitel |
Ssangyong Information and KT Hitel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssangyong Information and KT Hitel
The main advantage of trading using opposite Ssangyong Information and KT Hitel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssangyong Information position performs unexpectedly, KT Hitel 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 KT Hitel will offset losses from the drop in KT Hitel's long position.| Ssangyong Information vs. SBI Investment KOREA | Ssangyong Information vs. Jeju Beer Co | Ssangyong Information vs. Coloray International Investment | Ssangyong Information vs. NH Investment Securities |
| KT Hitel vs. Dongkuk Structures Construction | KT Hitel vs. Ssangyong Information Communication | KT Hitel vs. Sungdo Engineering Construction | KT Hitel vs. Woorim Machinery 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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