Correlation Between Semyung Electric and Daelim Trading
Can any of the company-specific risk be diversified away by investing in both Semyung Electric and Daelim Trading 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 Semyung Electric and Daelim Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Semyung Electric Machinery and Daelim Trading Co, you can compare the effects of market volatilities on Semyung Electric and Daelim Trading 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 Semyung Electric with a short position of Daelim Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semyung Electric and Daelim Trading.
Diversification Opportunities for Semyung Electric and Daelim Trading
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Semyung and Daelim is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Semyung Electric Machinery and Daelim Trading Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daelim Trading and Semyung Electric 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 Semyung Electric Machinery are associated (or correlated) with Daelim Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daelim Trading has no effect on the direction of Semyung Electric i.e., Semyung Electric and Daelim Trading go up and down completely randomly.
Pair Corralation between Semyung Electric and Daelim Trading
Assuming the 90 days trading horizon Semyung Electric Machinery is expected to generate 4.89 times more return on investment than Daelim Trading. However, Semyung Electric is 4.89 times more volatile than Daelim Trading Co. It trades about 0.25 of its potential returns per unit of risk. Daelim Trading Co is currently generating about -0.05 per unit of risk. If you would invest 468,788 in Semyung Electric Machinery on October 25, 2024 and sell it today you would earn a total of 169,212 from holding Semyung Electric Machinery or generate 36.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Semyung Electric Machinery vs. Daelim Trading Co
Performance |
| Timeline |
| Semyung Electric Mac |
| Daelim Trading |
Semyung Electric and Daelim Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Semyung Electric and Daelim Trading
The main advantage of trading using opposite Semyung Electric and Daelim Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semyung Electric position performs unexpectedly, Daelim Trading 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 Daelim Trading will offset losses from the drop in Daelim Trading's long position.| Semyung Electric vs. Dawonsys CoLtd | Semyung Electric vs. Elentec Co | Semyung Electric vs. Robostar CoLtd | Semyung Electric vs. HyVision System |
| Daelim Trading vs. LG Household Healthcare | Daelim Trading vs. Green Cross Medical | Daelim Trading vs. Seoul Electronics Telecom | Daelim Trading vs. Samyoung Electronics Co |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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