Correlation Between Daishin Information and SNTEnergy
Can any of the company-specific risk be diversified away by investing in both Daishin Information and SNTEnergy 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 Daishin Information and SNTEnergy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daishin Information Communications and SNTEnergy Co, you can compare the effects of market volatilities on Daishin Information and SNTEnergy 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 Daishin Information with a short position of SNTEnergy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daishin Information and SNTEnergy.
Diversification Opportunities for Daishin Information and SNTEnergy
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Daishin and SNTEnergy is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Daishin Information Communicat and SNTEnergy Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNTEnergy and Daishin Information 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 Daishin Information Communications are associated (or correlated) with SNTEnergy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNTEnergy has no effect on the direction of Daishin Information i.e., Daishin Information and SNTEnergy go up and down completely randomly.
Pair Corralation between Daishin Information and SNTEnergy
Assuming the 90 days trading horizon Daishin Information Communications is expected to generate 0.56 times more return on investment than SNTEnergy. However, Daishin Information Communications is 1.8 times less risky than SNTEnergy. It trades about 0.34 of its potential returns per unit of risk. SNTEnergy Co is currently generating about 0.09 per unit of risk. If you would invest 83,400 in Daishin Information Communications on September 13, 2024 and sell it today you would earn a total of 20,800 from holding Daishin Information Communications or generate 24.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Daishin Information Communicat vs. SNTEnergy Co
Performance |
| Timeline |
| Daishin Information |
| SNTEnergy |
Daishin Information and SNTEnergy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daishin Information and SNTEnergy
The main advantage of trading using opposite Daishin Information and SNTEnergy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daishin Information position performs unexpectedly, SNTEnergy 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 SNTEnergy will offset losses from the drop in SNTEnergy's long position.| Daishin Information vs. Settlebank | Daishin Information vs. Solution Advanced Technology | Daishin Information vs. Busan Industrial Co | Daishin Information vs. Busan Ind |
| SNTEnergy vs. LG Energy Solution | SNTEnergy vs. Doosan Heavy Ind | SNTEnergy vs. Hyosung Heavy Industries | SNTEnergy vs. Aprogen KIC |
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 Correlations module to find global opportunities by holding instruments from different markets.
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