Correlation Between Semyung Electric and Samil CoLtd
Can any of the company-specific risk be diversified away by investing in both Semyung Electric and Samil CoLtd 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 Samil CoLtd 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 Samil CoLtd, you can compare the effects of market volatilities on Semyung Electric and Samil CoLtd 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 Samil CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semyung Electric and Samil CoLtd.
Diversification Opportunities for Semyung Electric and Samil CoLtd
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Semyung and Samil is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Semyung Electric Machinery and Samil CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samil CoLtd 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 Samil CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samil CoLtd has no effect on the direction of Semyung Electric i.e., Semyung Electric and Samil CoLtd go up and down completely randomly.
Pair Corralation between Semyung Electric and Samil CoLtd
Assuming the 90 days trading horizon Semyung Electric Machinery is expected to generate 1.82 times more return on investment than Samil CoLtd. However, Semyung Electric is 1.82 times more volatile than Samil CoLtd. It trades about 0.04 of its potential returns per unit of risk. Samil CoLtd is currently generating about 0.04 per unit of risk. If you would invest 296,529 in Semyung Electric Machinery on September 14, 2024 and sell it today you would earn a total of 147,971 from holding Semyung Electric Machinery or generate 49.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Semyung Electric Machinery vs. Samil CoLtd
Performance |
| Timeline |
| Semyung Electric Mac |
| Samil CoLtd |
Semyung Electric and Samil CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Semyung Electric and Samil CoLtd
The main advantage of trading using opposite Semyung Electric and Samil CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semyung Electric position performs unexpectedly, Samil CoLtd 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 Samil CoLtd will offset losses from the drop in Samil CoLtd's long position.| Semyung Electric vs. HyVision System | Semyung Electric vs. Daebo Magnetic CoLtd | Semyung Electric vs. Vitzro Tech Co | Semyung Electric vs. Solution Advanced Technology |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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