Correlation Between SungMoon Electronics and KCC Engineering
Can any of the company-specific risk be diversified away by investing in both SungMoon Electronics and KCC Engineering 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 SungMoon Electronics and KCC Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SungMoon Electronics Co and KCC Engineering Construction, you can compare the effects of market volatilities on SungMoon Electronics and KCC Engineering 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 SungMoon Electronics with a short position of KCC Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of SungMoon Electronics and KCC Engineering.
Diversification Opportunities for SungMoon Electronics and KCC Engineering
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SungMoon and KCC is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SungMoon Electronics Co and KCC Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KCC Engineering Cons and SungMoon Electronics 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 SungMoon Electronics Co are associated (or correlated) with KCC Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KCC Engineering Cons has no effect on the direction of SungMoon Electronics i.e., SungMoon Electronics and KCC Engineering go up and down completely randomly.
Pair Corralation between SungMoon Electronics and KCC Engineering
Assuming the 90 days trading horizon SungMoon Electronics Co is expected to generate 2.12 times more return on investment than KCC Engineering. However, SungMoon Electronics is 2.12 times more volatile than KCC Engineering Construction. It trades about 0.15 of its potential returns per unit of risk. KCC Engineering Construction is currently generating about -0.09 per unit of risk. If you would invest 111,600 in SungMoon Electronics Co on October 20, 2024 and sell it today you would earn a total of 6,400 from holding SungMoon Electronics Co or generate 5.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SungMoon Electronics Co vs. KCC Engineering Construction
Performance |
| Timeline |
| SungMoon Electronics |
| KCC Engineering Cons |
SungMoon Electronics and KCC Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SungMoon Electronics and KCC Engineering
The main advantage of trading using opposite SungMoon Electronics and KCC Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SungMoon Electronics position performs unexpectedly, KCC Engineering 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 KCC Engineering will offset losses from the drop in KCC Engineering's long position.| SungMoon Electronics vs. National Plastic Co | SungMoon Electronics vs. Solus Advanced Materials | SungMoon Electronics vs. Dgb Financial | SungMoon Electronics vs. Union Materials Corp |
| KCC Engineering vs. Amogreentech Co | KCC Engineering vs. SungMoon Electronics Co | KCC Engineering vs. Jeju Air Co | KCC Engineering vs. Seoul Electronics Telecom |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |