Correlation Between Ssangyong Information and BHI
Can any of the company-specific risk be diversified away by investing in both Ssangyong Information and BHI 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 BHI 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 BHI Co, you can compare the effects of market volatilities on Ssangyong Information and BHI 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 BHI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssangyong Information and BHI.
Diversification Opportunities for Ssangyong Information and BHI
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ssangyong and BHI is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Ssangyong Information Communic and BHI Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BHI Co 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 BHI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BHI Co has no effect on the direction of Ssangyong Information i.e., Ssangyong Information and BHI go up and down completely randomly.
Pair Corralation between Ssangyong Information and BHI
Assuming the 90 days trading horizon Ssangyong Information Communication is expected to under-perform the BHI. But the stock apears to be less risky and, when comparing its historical volatility, Ssangyong Information Communication is 6.33 times less risky than BHI. The stock trades about -0.13 of its potential returns per unit of risk. The BHI Co is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 1,594,000 in BHI Co on November 7, 2024 and sell it today you would earn a total of 601,000 from holding BHI Co or generate 37.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ssangyong Information Communic vs. BHI Co
Performance |
| Timeline |
| Ssangyong Information |
| BHI Co |
Ssangyong Information and BHI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssangyong Information and BHI
The main advantage of trading using opposite Ssangyong Information and BHI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssangyong Information position performs unexpectedly, BHI 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 BHI will offset losses from the drop in BHI's long position.| Ssangyong Information vs. Bosung Power Technology | Ssangyong Information vs. Neungyule Education | Ssangyong Information vs. Samsung Publishing Co | Ssangyong Information vs. HB Technology TD |
| BHI vs. Youl Chon Chemical | BHI vs. Solus Advanced Materials | BHI vs. Sung Bo Chemicals | BHI vs. Polaris Office Corp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |