Correlation Between Jeil Steel and Sung Bo
Can any of the company-specific risk be diversified away by investing in both Jeil Steel and Sung Bo 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 Jeil Steel and Sung Bo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeil Steel Mfg and Sung Bo Chemicals, you can compare the effects of market volatilities on Jeil Steel and Sung Bo 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 Jeil Steel with a short position of Sung Bo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeil Steel and Sung Bo.
Diversification Opportunities for Jeil Steel and Sung Bo
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jeil and Sung is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Jeil Steel Mfg and Sung Bo Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sung Bo Chemicals and Jeil Steel 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 Jeil Steel Mfg are associated (or correlated) with Sung Bo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sung Bo Chemicals has no effect on the direction of Jeil Steel i.e., Jeil Steel and Sung Bo go up and down completely randomly.
Pair Corralation between Jeil Steel and Sung Bo
Assuming the 90 days trading horizon Jeil Steel Mfg is expected to generate 2.9 times more return on investment than Sung Bo. However, Jeil Steel is 2.9 times more volatile than Sung Bo Chemicals. It trades about 0.0 of its potential returns per unit of risk. Sung Bo Chemicals is currently generating about -0.04 per unit of risk. If you would invest 262,000 in Jeil Steel Mfg on August 31, 2024 and sell it today you would lose (83,000) from holding Jeil Steel Mfg or give up 31.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeil Steel Mfg vs. Sung Bo Chemicals
Performance |
| Timeline |
| Jeil Steel Mfg |
| Sung Bo Chemicals |
Jeil Steel and Sung Bo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeil Steel and Sung Bo
The main advantage of trading using opposite Jeil Steel and Sung Bo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeil Steel position performs unexpectedly, Sung Bo 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 Sung Bo will offset losses from the drop in Sung Bo's long position.| Jeil Steel vs. Korea Information Communications | Jeil Steel vs. ECSTELECOM Co | Jeil Steel vs. FOODWELL Co | Jeil Steel vs. DB Insurance Co |
| Sung Bo vs. AptaBio Therapeutics | Sung Bo vs. Daewoo SBI SPAC | Sung Bo vs. Dream Security co | Sung Bo vs. Microfriend |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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