Correlation Between Semyung Electric and FLITTO
Can any of the company-specific risk be diversified away by investing in both Semyung Electric and FLITTO 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 FLITTO 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 FLITTO Inc, you can compare the effects of market volatilities on Semyung Electric and FLITTO 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 FLITTO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semyung Electric and FLITTO.
Diversification Opportunities for Semyung Electric and FLITTO
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Semyung and FLITTO is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Semyung Electric Machinery and FLITTO Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLITTO Inc 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 FLITTO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLITTO Inc has no effect on the direction of Semyung Electric i.e., Semyung Electric and FLITTO go up and down completely randomly.
Pair Corralation between Semyung Electric and FLITTO
Assuming the 90 days trading horizon Semyung Electric Machinery is expected to generate 0.46 times more return on investment than FLITTO. However, Semyung Electric Machinery is 2.19 times less risky than FLITTO. It trades about 0.07 of its potential returns per unit of risk. FLITTO Inc is currently generating about 0.01 per unit of risk. If you would invest 588,000 in Semyung Electric Machinery on November 29, 2024 and sell it today you would earn a total of 19,000 from holding Semyung Electric Machinery or generate 3.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Semyung Electric Machinery vs. FLITTO Inc
Performance |
| Timeline |
| Semyung Electric Mac |
| FLITTO Inc |
Semyung Electric and FLITTO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Semyung Electric and FLITTO
The main advantage of trading using opposite Semyung Electric and FLITTO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semyung Electric position performs unexpectedly, FLITTO 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 FLITTO will offset losses from the drop in FLITTO's long position.| Semyung Electric vs. Lotte Fine Chemical | Semyung Electric vs. Echomarketing CoLtd | Semyung Electric vs. Kukdo Chemical Co | Semyung Electric vs. SK Chemicals Co |
| FLITTO vs. Miwon Chemicals Co | FLITTO vs. INSUN Environmental New | FLITTO vs. Dongil Steel Co | FLITTO vs. Dongkuk Steel Mill |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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