Correlation Between Ssangyong Information and Haitai Confectionery
Can any of the company-specific risk be diversified away by investing in both Ssangyong Information and Haitai Confectionery 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 Haitai Confectionery 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 Haitai Confectionery Foods, you can compare the effects of market volatilities on Ssangyong Information and Haitai Confectionery 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 Haitai Confectionery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssangyong Information and Haitai Confectionery.
Diversification Opportunities for Ssangyong Information and Haitai Confectionery
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ssangyong and Haitai is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ssangyong Information Communic and Haitai Confectionery Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haitai Confectionery 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 Haitai Confectionery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haitai Confectionery has no effect on the direction of Ssangyong Information i.e., Ssangyong Information and Haitai Confectionery go up and down completely randomly.
Pair Corralation between Ssangyong Information and Haitai Confectionery
Assuming the 90 days trading horizon Ssangyong Information Communication is expected to generate 0.99 times more return on investment than Haitai Confectionery. However, Ssangyong Information Communication is 1.01 times less risky than Haitai Confectionery. It trades about -0.07 of its potential returns per unit of risk. Haitai Confectionery Foods is currently generating about -0.17 per unit of risk. If you would invest 63,900 in Ssangyong Information Communication on October 29, 2024 and sell it today you would lose (1,000.00) from holding Ssangyong Information Communication or give up 1.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ssangyong Information Communic vs. Haitai Confectionery Foods
Performance |
| Timeline |
| Ssangyong Information |
| Haitai Confectionery |
Ssangyong Information and Haitai Confectionery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssangyong Information and Haitai Confectionery
The main advantage of trading using opposite Ssangyong Information and Haitai Confectionery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssangyong Information position performs unexpectedly, Haitai Confectionery 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 Haitai Confectionery will offset losses from the drop in Haitai Confectionery's long position.| Ssangyong Information vs. SH Energy Chemical | Ssangyong Information vs. Kukil Metal Co | Ssangyong Information vs. Dongil Metal Co | Ssangyong Information vs. Youl Chon Chemical |
| Haitai Confectionery vs. Camus Engineering Construction | Haitai Confectionery vs. Nable Communications | Haitai Confectionery vs. Neungyule Education | Haitai Confectionery vs. Asiana Airlines |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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