Correlation Between Iljin Display and Sungchang Autotech
Can any of the company-specific risk be diversified away by investing in both Iljin Display and Sungchang Autotech 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 Iljin Display and Sungchang Autotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iljin Display and Sungchang Autotech Co, you can compare the effects of market volatilities on Iljin Display and Sungchang Autotech 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 Iljin Display with a short position of Sungchang Autotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iljin Display and Sungchang Autotech.
Diversification Opportunities for Iljin Display and Sungchang Autotech
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Iljin and Sungchang is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Iljin Display and Sungchang Autotech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sungchang Autotech and Iljin Display 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 Iljin Display are associated (or correlated) with Sungchang Autotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sungchang Autotech has no effect on the direction of Iljin Display i.e., Iljin Display and Sungchang Autotech go up and down completely randomly.
Pair Corralation between Iljin Display and Sungchang Autotech
Assuming the 90 days trading horizon Iljin Display is expected to generate 2.82 times more return on investment than Sungchang Autotech. However, Iljin Display is 2.82 times more volatile than Sungchang Autotech Co. It trades about 0.07 of its potential returns per unit of risk. Sungchang Autotech Co is currently generating about 0.11 per unit of risk. If you would invest 88,300 in Iljin Display on October 16, 2024 and sell it today you would earn a total of 2,500 from holding Iljin Display or generate 2.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Iljin Display vs. Sungchang Autotech Co
Performance |
| Timeline |
| Iljin Display |
| Sungchang Autotech |
Iljin Display and Sungchang Autotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iljin Display and Sungchang Autotech
The main advantage of trading using opposite Iljin Display and Sungchang Autotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iljin Display position performs unexpectedly, Sungchang Autotech 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 Sungchang Autotech will offset losses from the drop in Sungchang Autotech's long position.| Iljin Display vs. SH Energy Chemical | Iljin Display vs. KPX Green Chemical | Iljin Display vs. Dongbang Ship Machinery | Iljin Display vs. Dongnam Chemical Co |
| Sungchang Autotech vs. Dongbang Transport Logistics | Sungchang Autotech vs. Lotte Non Life Insurance | Sungchang Autotech vs. Genie Music | Sungchang Autotech vs. Sangsin Energy Display |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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