Correlation Between Kyung In and Sempio Foods
Can any of the company-specific risk be diversified away by investing in both Kyung In and Sempio 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 Kyung In and Sempio Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kyung In Synthetic Corp and Sempio Foods Co, you can compare the effects of market volatilities on Kyung In and Sempio 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 Kyung In with a short position of Sempio Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyung In and Sempio Foods.
Diversification Opportunities for Kyung In and Sempio Foods
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kyung and Sempio is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Kyung In Synthetic Corp and Sempio Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sempio Foods and Kyung In 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 Kyung In Synthetic Corp are associated (or correlated) with Sempio Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sempio Foods has no effect on the direction of Kyung In i.e., Kyung In and Sempio Foods go up and down completely randomly.
Pair Corralation between Kyung In and Sempio Foods
Assuming the 90 days trading horizon Kyung In Synthetic Corp is expected to generate 1.61 times more return on investment than Sempio Foods. However, Kyung In is 1.61 times more volatile than Sempio Foods Co. It trades about 0.07 of its potential returns per unit of risk. Sempio Foods Co is currently generating about -0.67 per unit of risk. If you would invest 278,500 in Kyung In Synthetic Corp on November 5, 2024 and sell it today you would earn a total of 3,500 from holding Kyung In Synthetic Corp or generate 1.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kyung In Synthetic Corp vs. Sempio Foods Co
Performance |
| Timeline |
| Kyung In Synthetic |
| Sempio Foods |
Kyung In and Sempio Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kyung In and Sempio Foods
The main advantage of trading using opposite Kyung In and Sempio Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyung In position performs unexpectedly, Sempio 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 Sempio Foods will offset losses from the drop in Sempio Foods' long position.| Kyung In vs. Daou Data Corp | Kyung In vs. Hanil Chemical Ind | Kyung In vs. Hanmi Semiconductor Co | Kyung In vs. Daishin Information Communications |
| Sempio Foods vs. PH Tech Co | Sempio Foods vs. Woori Technology | Sempio Foods vs. Solution Advanced Technology | Sempio Foods vs. Daishin Information Communications |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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