Correlation Between Automobile and Shinhan Inverse
Can any of the company-specific risk be diversified away by investing in both Automobile and Shinhan Inverse 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 Automobile and Shinhan Inverse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Automobile Pc and Shinhan Inverse Silver, you can compare the effects of market volatilities on Automobile and Shinhan Inverse 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 Automobile with a short position of Shinhan Inverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Automobile and Shinhan Inverse.
Diversification Opportunities for Automobile and Shinhan Inverse
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Automobile and Shinhan is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Automobile Pc and Shinhan Inverse Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Inverse Silver and Automobile 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 Automobile Pc are associated (or correlated) with Shinhan Inverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Inverse Silver has no effect on the direction of Automobile i.e., Automobile and Shinhan Inverse go up and down completely randomly.
Pair Corralation between Automobile and Shinhan Inverse
Assuming the 90 days trading horizon Automobile is expected to generate 3.08 times less return on investment than Shinhan Inverse. In addition to that, Automobile is 2.46 times more volatile than Shinhan Inverse Silver. It trades about 0.04 of its total potential returns per unit of risk. Shinhan Inverse Silver is currently generating about 0.27 per unit of volatility. If you would invest 325,500 in Shinhan Inverse Silver on August 29, 2024 and sell it today you would earn a total of 35,500 from holding Shinhan Inverse Silver or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Automobile Pc vs. Shinhan Inverse Silver
Performance |
| Timeline |
| Automobile Pc |
| Shinhan Inverse Silver |
Automobile and Shinhan Inverse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Automobile and Shinhan Inverse
The main advantage of trading using opposite Automobile and Shinhan Inverse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Automobile position performs unexpectedly, Shinhan Inverse 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 Shinhan Inverse will offset losses from the drop in Shinhan Inverse's long position.| Automobile vs. Hanwha InvestmentSecurities Co | Automobile vs. Sangsin Energy Display | Automobile vs. Atinum Investment Co | Automobile vs. LB Investment |
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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.
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