Correlation Between Ssangyong Information and BNK Financial
Can any of the company-specific risk be diversified away by investing in both Ssangyong Information and BNK Financial 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 BNK Financial 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 BNK Financial Group, you can compare the effects of market volatilities on Ssangyong Information and BNK Financial 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 BNK Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssangyong Information and BNK Financial.
Diversification Opportunities for Ssangyong Information and BNK Financial
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ssangyong and BNK is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Ssangyong Information Communic and BNK Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNK Financial Group 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 BNK Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNK Financial Group has no effect on the direction of Ssangyong Information i.e., Ssangyong Information and BNK Financial go up and down completely randomly.
Pair Corralation between Ssangyong Information and BNK Financial
Assuming the 90 days trading horizon Ssangyong Information Communication is expected to generate 0.71 times more return on investment than BNK Financial. However, Ssangyong Information Communication is 1.41 times less risky than BNK Financial. It trades about 0.11 of its potential returns per unit of risk. BNK Financial Group is currently generating about -0.16 per unit of risk. If you would invest 63,100 in Ssangyong Information Communication on October 13, 2024 and sell it today you would earn a total of 1,400 from holding Ssangyong Information Communication or generate 2.22% 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. BNK Financial Group
Performance |
| Timeline |
| Ssangyong Information |
| BNK Financial Group |
Ssangyong Information and BNK Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssangyong Information and BNK Financial
The main advantage of trading using opposite Ssangyong Information and BNK Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssangyong Information position performs unexpectedly, BNK Financial 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 BNK Financial will offset losses from the drop in BNK Financial's long position.| Ssangyong Information vs. LG Household Healthcare | Ssangyong Information vs. Mgame Corp | Ssangyong Information vs. Dong A Steel Technology | Ssangyong Information vs. DoubleU Games Co |
| BNK Financial vs. Digital Power Communications | BNK Financial vs. Ssangyong Information Communication | BNK Financial vs. DONGKUK TED METAL | BNK Financial vs. Kbi Metal 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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