Correlation Between Wonil Special and SKONEC Entertainment
Can any of the company-specific risk be diversified away by investing in both Wonil Special and SKONEC Entertainment 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 Wonil Special and SKONEC Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wonil Special Steel and SKONEC Entertainment Co, you can compare the effects of market volatilities on Wonil Special and SKONEC Entertainment 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 Wonil Special with a short position of SKONEC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonil Special and SKONEC Entertainment.
Diversification Opportunities for Wonil Special and SKONEC Entertainment
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wonil and SKONEC is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Wonil Special Steel and SKONEC Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SKONEC Entertainment and Wonil Special 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 Wonil Special Steel are associated (or correlated) with SKONEC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SKONEC Entertainment has no effect on the direction of Wonil Special i.e., Wonil Special and SKONEC Entertainment go up and down completely randomly.
Pair Corralation between Wonil Special and SKONEC Entertainment
Assuming the 90 days trading horizon Wonil Special Steel is expected to under-perform the SKONEC Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, Wonil Special Steel is 2.32 times less risky than SKONEC Entertainment. The stock trades about -0.05 of its potential returns per unit of risk. The SKONEC Entertainment Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 295,500 in SKONEC Entertainment Co on September 13, 2024 and sell it today you would lose (3,000) from holding SKONEC Entertainment Co or give up 1.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wonil Special Steel vs. SKONEC Entertainment Co
Performance |
| Timeline |
| Wonil Special Steel |
| SKONEC Entertainment |
Wonil Special and SKONEC Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonil Special and SKONEC Entertainment
The main advantage of trading using opposite Wonil Special and SKONEC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonil Special position performs unexpectedly, SKONEC Entertainment 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 SKONEC Entertainment will offset losses from the drop in SKONEC Entertainment's long position.| Wonil Special vs. LG Chemicals | Wonil Special vs. POSCO Holdings | Wonil Special vs. Hanwha Solutions | Wonil Special vs. Lotte Chemical Corp |
| SKONEC Entertainment vs. Kakao Games Corp | SKONEC Entertainment vs. Devsisters corporation | SKONEC Entertainment vs. Konan Technology | SKONEC Entertainment vs. Nice Information Telecommunication |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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