Correlation Between Ssangyong Information and Lotte Reit
Can any of the company-specific risk be diversified away by investing in both Ssangyong Information and Lotte Reit 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 Lotte Reit 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 Lotte Reit Co, you can compare the effects of market volatilities on Ssangyong Information and Lotte Reit 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 Lotte Reit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ssangyong Information and Lotte Reit.
Diversification Opportunities for Ssangyong Information and Lotte Reit
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ssangyong and Lotte is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Ssangyong Information Communic and Lotte Reit Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Reit 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 Lotte Reit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Reit has no effect on the direction of Ssangyong Information i.e., Ssangyong Information and Lotte Reit go up and down completely randomly.
Pair Corralation between Ssangyong Information and Lotte Reit
Assuming the 90 days trading horizon Ssangyong Information Communication is expected to generate 0.96 times more return on investment than Lotte Reit. However, Ssangyong Information Communication is 1.04 times less risky than Lotte Reit. It trades about 0.04 of its potential returns per unit of risk. Lotte Reit Co is currently generating about -0.01 per unit of risk. If you would invest 63,600 in Ssangyong Information Communication on October 25, 2024 and sell it today you would earn a total of 400.00 from holding Ssangyong Information Communication or generate 0.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Ssangyong Information Communic vs. Lotte Reit Co
Performance |
| Timeline |
| Ssangyong Information |
| Lotte Reit |
Ssangyong Information and Lotte Reit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ssangyong Information and Lotte Reit
The main advantage of trading using opposite Ssangyong Information and Lotte Reit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ssangyong Information position performs unexpectedly, Lotte Reit 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 Lotte Reit will offset losses from the drop in Lotte Reit's long position.| Ssangyong Information vs. Hyundai Home Shopping | Ssangyong Information vs. GS Engineering Construction | Ssangyong Information vs. Hankook Furniture Co | Ssangyong Information vs. Seoam Machinery Industry |
| Lotte Reit vs. Taegu Broadcasting | Lotte Reit vs. BNK Financial Group | Lotte Reit vs. Sung Bo Chemicals | Lotte Reit vs. Settlebank |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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