Correlation Between SHINWON STRUCTION and Sempio Foods
Can any of the company-specific risk be diversified away by investing in both SHINWON STRUCTION 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 SHINWON STRUCTION and Sempio Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SHINWON STRUCTION COMPANY and Sempio Foods Co, you can compare the effects of market volatilities on SHINWON STRUCTION 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 SHINWON STRUCTION with a short position of Sempio Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of SHINWON STRUCTION and Sempio Foods.
Diversification Opportunities for SHINWON STRUCTION and Sempio Foods
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SHINWON and Sempio is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding SHINWON STRUCTION COMPANY and Sempio Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sempio Foods and SHINWON STRUCTION 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 SHINWON STRUCTION COMPANY 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 SHINWON STRUCTION i.e., SHINWON STRUCTION and Sempio Foods go up and down completely randomly.
Pair Corralation between SHINWON STRUCTION and Sempio Foods
Assuming the 90 days trading horizon SHINWON STRUCTION COMPANY is expected to generate 1.2 times more return on investment than Sempio Foods. However, SHINWON STRUCTION is 1.2 times more volatile than Sempio Foods Co. It trades about 0.01 of its potential returns per unit of risk. Sempio Foods Co is currently generating about -0.02 per unit of risk. If you would invest 290,000 in SHINWON STRUCTION COMPANY on October 20, 2024 and sell it today you would earn a total of 500.00 from holding SHINWON STRUCTION COMPANY or generate 0.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SHINWON STRUCTION COMPANY vs. Sempio Foods Co
Performance |
| Timeline |
| SHINWON STRUCTION PANY |
| Sempio Foods |
SHINWON STRUCTION and Sempio Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SHINWON STRUCTION and Sempio Foods
The main advantage of trading using opposite SHINWON STRUCTION and Sempio Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SHINWON STRUCTION 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.| SHINWON STRUCTION vs. Daou Data Corp | SHINWON STRUCTION vs. Busan Industrial Co | SHINWON STRUCTION vs. Busan Ind | SHINWON STRUCTION vs. Mirae Asset Daewoo |
| Sempio Foods vs. Samsung Electronics Co | Sempio Foods vs. Samsung Electronics Co | Sempio Foods vs. LG Energy Solution | Sempio Foods vs. SK Hynix |
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 CEOs Directory module to screen CEOs from public companies around the world.
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