Correlation Between Seoyon Topmetal and Guyoung Technology
Can any of the company-specific risk be diversified away by investing in both Seoyon Topmetal and Guyoung 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 Seoyon Topmetal and Guyoung Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seoyon Topmetal Co and Guyoung Technology Co, you can compare the effects of market volatilities on Seoyon Topmetal and Guyoung 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 Seoyon Topmetal with a short position of Guyoung Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seoyon Topmetal and Guyoung Technology.
Diversification Opportunities for Seoyon Topmetal and Guyoung Technology
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Seoyon and Guyoung is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Seoyon Topmetal Co and Guyoung Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guyoung Technology and Seoyon Topmetal 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 Seoyon Topmetal Co are associated (or correlated) with Guyoung Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guyoung Technology has no effect on the direction of Seoyon Topmetal i.e., Seoyon Topmetal and Guyoung Technology go up and down completely randomly.
Pair Corralation between Seoyon Topmetal and Guyoung Technology
Assuming the 90 days trading horizon Seoyon Topmetal Co is expected to generate 1.59 times more return on investment than Guyoung Technology. However, Seoyon Topmetal is 1.59 times more volatile than Guyoung Technology Co. It trades about 0.1 of its potential returns per unit of risk. Guyoung Technology Co is currently generating about -0.15 per unit of risk. If you would invest 363,500 in Seoyon Topmetal Co on August 28, 2024 and sell it today you would earn a total of 17,000 from holding Seoyon Topmetal Co or generate 4.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seoyon Topmetal Co vs. Guyoung Technology Co
Performance |
| Timeline |
| Seoyon Topmetal |
| Guyoung Technology |
Seoyon Topmetal and Guyoung Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seoyon Topmetal and Guyoung Technology
The main advantage of trading using opposite Seoyon Topmetal and Guyoung Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seoyon Topmetal position performs unexpectedly, Guyoung 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 Guyoung Technology will offset losses from the drop in Guyoung Technology's long position.| Seoyon Topmetal vs. Busan Industrial Co | Seoyon Topmetal vs. Busan Ind | Seoyon Topmetal vs. Mirae Asset Daewoo | Seoyon Topmetal vs. UNISEM Co |
| Guyoung Technology vs. Busan Industrial Co | Guyoung Technology vs. Busan Ind | Guyoung Technology vs. Mirae Asset Daewoo | Guyoung Technology vs. UNISEM 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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