Correlation Between Asiana Airlines and Samlip General
Can any of the company-specific risk be diversified away by investing in both Asiana Airlines and Samlip General 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 Asiana Airlines and Samlip General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asiana Airlines and Samlip General Foods, you can compare the effects of market volatilities on Asiana Airlines and Samlip General 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 Asiana Airlines with a short position of Samlip General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asiana Airlines and Samlip General.
Diversification Opportunities for Asiana Airlines and Samlip General
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Asiana and Samlip is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Asiana Airlines and Samlip General Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samlip General Foods and Asiana Airlines 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 Asiana Airlines are associated (or correlated) with Samlip General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samlip General Foods has no effect on the direction of Asiana Airlines i.e., Asiana Airlines and Samlip General go up and down completely randomly.
Pair Corralation between Asiana Airlines and Samlip General
Assuming the 90 days trading horizon Asiana Airlines is expected to generate 0.35 times more return on investment than Samlip General. However, Asiana Airlines is 2.83 times less risky than Samlip General. It trades about 0.09 of its potential returns per unit of risk. Samlip General Foods is currently generating about -0.24 per unit of risk. If you would invest 1,039,000 in Asiana Airlines on November 2, 2024 and sell it today you would earn a total of 13,000 from holding Asiana Airlines or generate 1.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Asiana Airlines vs. Samlip General Foods
Performance |
Timeline |
Asiana Airlines |
Samlip General Foods |
Asiana Airlines and Samlip General Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Asiana Airlines and Samlip General
The main advantage of trading using opposite Asiana Airlines and Samlip General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asiana Airlines position performs unexpectedly, Samlip General 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 Samlip General will offset losses from the drop in Samlip General's long position.Asiana Airlines vs. iNtRON Biotechnology | Asiana Airlines vs. Shinil Electronics Co | Asiana Airlines vs. Korea Electronic Certification | Asiana Airlines vs. Tway Air Co |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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