Correlation Between SBI Investment and People Technology
Can any of the company-specific risk be diversified away by investing in both SBI Investment and People Technology 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 SBI Investment and People Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBI Investment KOREA and People Technology, you can compare the effects of market volatilities on SBI Investment and People Technology 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 SBI Investment with a short position of People Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Investment and People Technology.
Diversification Opportunities for SBI Investment and People Technology
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between SBI and People is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding SBI Investment KOREA and People Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on People Technology and SBI Investment 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 SBI Investment KOREA are associated (or correlated) with People Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of People Technology has no effect on the direction of SBI Investment i.e., SBI Investment and People Technology go up and down completely randomly.
Pair Corralation between SBI Investment and People Technology
Assuming the 90 days trading horizon SBI Investment KOREA is expected to generate 0.72 times more return on investment than People Technology. However, SBI Investment KOREA is 1.39 times less risky than People Technology. It trades about 0.01 of its potential returns per unit of risk. People Technology is currently generating about -0.04 per unit of risk. If you would invest 72,500 in SBI Investment KOREA on August 28, 2024 and sell it today you would lose (100.00) from holding SBI Investment KOREA or give up 0.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBI Investment KOREA vs. People Technology
Performance |
| Timeline |
| SBI Investment KOREA |
| People Technology |
SBI Investment and People Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Investment and People Technology
The main advantage of trading using opposite SBI Investment and People Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Investment position performs unexpectedly, People Technology 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 People Technology will offset losses from the drop in People Technology's long position.| SBI Investment vs. Daekyung Machinery Engineering | SBI Investment vs. PlayD Co | SBI Investment vs. Playgram Co | SBI Investment vs. Camus Engineering Construction |
| People Technology vs. Samsung Electronics Co | People Technology vs. Samsung Electronics Co | People Technology vs. Hyundai Motor Co | People Technology vs. Hyundai Motor |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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