Correlation Between Ssangyong Information and Settlebank
Can any of the company-specific risk be diversified away by investing in both Ssangyong Information and Settlebank 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 Settlebank 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 Settlebank, you can compare the effects of market volatilities on Ssangyong Information and Settlebank 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 Settlebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssangyong Information and Settlebank.
Diversification Opportunities for Ssangyong Information and Settlebank
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ssangyong and Settlebank is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Ssangyong Information Communic and Settlebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Settlebank 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 Settlebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Settlebank has no effect on the direction of Ssangyong Information i.e., Ssangyong Information and Settlebank go up and down completely randomly.
Pair Corralation between Ssangyong Information and Settlebank
Assuming the 90 days trading horizon Ssangyong Information Communication is expected to under-perform the Settlebank. But the stock apears to be less risky and, when comparing its historical volatility, Ssangyong Information Communication is 1.73 times less risky than Settlebank. The stock trades about -0.04 of its potential returns per unit of risk. The Settlebank is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 2,310,482 in Settlebank on October 31, 2024 and sell it today you would lose (909,482) from holding Settlebank or give up 39.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ssangyong Information Communic vs. Settlebank
Performance |
| Timeline |
| Ssangyong Information |
| Settlebank |
Ssangyong Information and Settlebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssangyong Information and Settlebank
The main advantage of trading using opposite Ssangyong Information and Settlebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssangyong Information position performs unexpectedly, Settlebank 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 Settlebank will offset losses from the drop in Settlebank's long position.| Ssangyong Information vs. Daishin Information Communications | Ssangyong Information vs. Wave Electronics Co | Ssangyong Information vs. Shinil Electronics Co | Ssangyong Information vs. Nable Communications |
| Settlebank vs. Daishin Information Communications | Settlebank vs. SSR Inc | Settlebank vs. Busan Industrial Co | Settlebank vs. Busan Ind |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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