Correlation Between Busan Ind and SS TECH
Can any of the company-specific risk be diversified away by investing in both Busan Ind and SS TECH 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 SS TECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Busan Ind and SS TECH, you can compare the effects of market volatilities on Busan Ind and SS TECH 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 SS TECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Busan Ind and SS TECH.
Diversification Opportunities for Busan Ind and SS TECH
Excellent diversification
The 3 months correlation between Busan and 101490 is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Busan Ind and SS TECH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SS TECH 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 SS TECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SS TECH has no effect on the direction of Busan Ind i.e., Busan Ind and SS TECH go up and down completely randomly.
Pair Corralation between Busan Ind and SS TECH
Assuming the 90 days trading horizon Busan Ind is expected to generate 1.54 times more return on investment than SS TECH. However, Busan Ind is 1.54 times more volatile than SS TECH. It trades about 0.08 of its potential returns per unit of risk. SS TECH is currently generating about 0.04 per unit of risk. If you would invest 5,280,000 in Busan Ind on August 29, 2024 and sell it today you would earn a total of 400,000 from holding Busan Ind or generate 7.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Busan Ind vs. SS TECH
Performance |
| Timeline |
| Busan Ind |
| SS TECH |
Busan Ind and SS TECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Busan Ind and SS TECH
The main advantage of trading using opposite Busan Ind and SS TECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Busan Ind position performs unexpectedly, SS TECH 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 SS TECH will offset losses from the drop in SS TECH's long position.| Busan Ind vs. PJ Metal Co | Busan Ind vs. Lotte Chilsung Beverage | Busan Ind vs. Sempio Foods Co | Busan Ind vs. Korean Reinsurance Co |
| SS TECH vs. Daou Data Corp | SS TECH vs. Busan Industrial Co | SS TECH vs. Busan Ind | SS TECH vs. Shinhan WTI Futures |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |