Correlation Between Asiana Airlines and Myoung Shin
Can any of the company-specific risk be diversified away by investing in both Asiana Airlines and Myoung Shin 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 Myoung Shin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asiana Airlines and Myoung Shin Industrial, you can compare the effects of market volatilities on Asiana Airlines and Myoung Shin 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 Myoung Shin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asiana Airlines and Myoung Shin.
Diversification Opportunities for Asiana Airlines and Myoung Shin
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Asiana and Myoung is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Asiana Airlines and Myoung Shin Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Myoung Shin Industrial 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 Myoung Shin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Myoung Shin Industrial has no effect on the direction of Asiana Airlines i.e., Asiana Airlines and Myoung Shin go up and down completely randomly.
Pair Corralation between Asiana Airlines and Myoung Shin
Assuming the 90 days trading horizon Asiana Airlines is expected to generate 0.64 times more return on investment than Myoung Shin. However, Asiana Airlines is 1.56 times less risky than Myoung Shin. It trades about 0.08 of its potential returns per unit of risk. Myoung Shin Industrial is currently generating about 0.02 per unit of risk. If you would invest 895,000 in Asiana Airlines on November 3, 2024 and sell it today you would earn a total of 161,000 from holding Asiana Airlines or generate 17.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asiana Airlines vs. Myoung Shin Industrial
Performance |
| Timeline |
| Asiana Airlines |
| Myoung Shin Industrial |
Asiana Airlines and Myoung Shin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asiana Airlines and Myoung Shin
The main advantage of trading using opposite Asiana Airlines and Myoung Shin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asiana Airlines position performs unexpectedly, Myoung Shin 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 Myoung Shin will offset losses from the drop in Myoung Shin's long position.The idea behind Asiana Airlines and Myoung Shin Industrial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Myoung Shin vs. Busan Industrial Co | Myoung Shin vs. Busan Ind | Myoung Shin vs. Mirae Asset Daewoo | Myoung Shin vs. Shinhan WTI Futures |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |