Correlation Between Ilji Technology and Shinsegae Information
Can any of the company-specific risk be diversified away by investing in both Ilji Technology and Shinsegae Information 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 Ilji Technology and Shinsegae Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ilji Technology Co and Shinsegae Information Communication, you can compare the effects of market volatilities on Ilji Technology and Shinsegae Information 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 Ilji Technology with a short position of Shinsegae Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ilji Technology and Shinsegae Information.
Diversification Opportunities for Ilji Technology and Shinsegae Information
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ilji and Shinsegae is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Ilji Technology Co and Shinsegae Information Communic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinsegae Information and Ilji Technology 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 Ilji Technology Co are associated (or correlated) with Shinsegae Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinsegae Information has no effect on the direction of Ilji Technology i.e., Ilji Technology and Shinsegae Information go up and down completely randomly.
Pair Corralation between Ilji Technology and Shinsegae Information
Assuming the 90 days trading horizon Ilji Technology Co is expected to generate 1.28 times more return on investment than Shinsegae Information. However, Ilji Technology is 1.28 times more volatile than Shinsegae Information Communication. It trades about -0.1 of its potential returns per unit of risk. Shinsegae Information Communication is currently generating about -0.22 per unit of risk. If you would invest 411,500 in Ilji Technology Co on August 29, 2024 and sell it today you would lose (21,000) from holding Ilji Technology Co or give up 5.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ilji Technology Co vs. Shinsegae Information Communic
Performance |
| Timeline |
| Ilji Technology |
| Shinsegae Information |
Ilji Technology and Shinsegae Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ilji Technology and Shinsegae Information
The main advantage of trading using opposite Ilji Technology and Shinsegae Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ilji Technology position performs unexpectedly, Shinsegae Information 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 Shinsegae Information will offset losses from the drop in Shinsegae Information's long position.| Ilji Technology vs. Ssangyong Information Communication | Ilji Technology vs. Daishin Information Communications | Ilji Technology vs. FNSTech Co | Ilji Technology vs. GS Retail Co |
| Shinsegae Information vs. AptaBio Therapeutics | Shinsegae Information vs. Daewoo SBI SPAC | Shinsegae Information vs. Dream Security co | Shinsegae Information vs. Microfriend |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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