Correlation Between Busan Ind and Samyang Foods
Can any of the company-specific risk be diversified away by investing in both Busan Ind and Samyang Foods 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 Busan Ind and Samyang Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Busan Ind and Samyang Foods Co, you can compare the effects of market volatilities on Busan Ind and Samyang Foods 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 Busan Ind with a short position of Samyang Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Busan Ind and Samyang Foods.
Diversification Opportunities for Busan Ind and Samyang Foods
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Busan and Samyang is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Busan Ind and Samyang Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyang Foods and Busan Ind 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 Busan Ind are associated (or correlated) with Samyang Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyang Foods has no effect on the direction of Busan Ind i.e., Busan Ind and Samyang Foods go up and down completely randomly.
Pair Corralation between Busan Ind and Samyang Foods
Assuming the 90 days trading horizon Busan Ind is expected to generate 11.38 times less return on investment than Samyang Foods. But when comparing it to its historical volatility, Busan Ind is 1.19 times less risky than Samyang Foods. It trades about 0.01 of its potential returns per unit of risk. Samyang Foods Co is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 11,474,200 in Samyang Foods Co on December 11, 2024 and sell it today you would earn a total of 78,225,800 from holding Samyang Foods Co or generate 681.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Busan Ind vs. Samyang Foods Co
Performance |
| Timeline |
| Busan Ind |
| Samyang Foods |
Busan Ind and Samyang Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Busan Ind and Samyang Foods
The main advantage of trading using opposite Busan Ind and Samyang Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Busan Ind position performs unexpectedly, Samyang Foods 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 Samyang Foods will offset losses from the drop in Samyang Foods' long position.| Busan Ind vs. Korean Drug Co | Busan Ind vs. TJ media Co | Busan Ind vs. Digital Multimedia Technology | Busan Ind vs. Aprogen Healthcare Games |
| Samyang Foods vs. Woori Technology | Samyang Foods vs. Union Materials Corp | Samyang Foods vs. WONIK Materials CoLtd | Samyang Foods vs. Orbitech 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |