Correlation Between Shinsegae Food and Samyoung Electronics
Can any of the company-specific risk be diversified away by investing in both Shinsegae Food and Samyoung Electronics 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 Shinsegae Food and Samyoung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsegae Food and Samyoung Electronics Co, you can compare the effects of market volatilities on Shinsegae Food and Samyoung Electronics 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 Shinsegae Food with a short position of Samyoung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Food and Samyoung Electronics.
Diversification Opportunities for Shinsegae Food and Samyoung Electronics
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shinsegae and Samyoung is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Food and Samyoung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyoung Electronics and Shinsegae Food 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 Shinsegae Food are associated (or correlated) with Samyoung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyoung Electronics has no effect on the direction of Shinsegae Food i.e., Shinsegae Food and Samyoung Electronics go up and down completely randomly.
Pair Corralation between Shinsegae Food and Samyoung Electronics
Assuming the 90 days trading horizon Shinsegae Food is expected to under-perform the Samyoung Electronics. In addition to that, Shinsegae Food is 2.59 times more volatile than Samyoung Electronics Co. It trades about -0.2 of its total potential returns per unit of risk. Samyoung Electronics Co is currently generating about 0.32 per unit of volatility. If you would invest 980,000 in Samyoung Electronics Co on November 6, 2024 and sell it today you would earn a total of 57,000 from holding Samyoung Electronics Co or generate 5.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinsegae Food vs. Samyoung Electronics Co
Performance |
| Timeline |
| Shinsegae Food |
| Samyoung Electronics |
Shinsegae Food and Samyoung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Food and Samyoung Electronics
The main advantage of trading using opposite Shinsegae Food and Samyoung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Food position performs unexpectedly, Samyoung Electronics 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 Samyoung Electronics will offset losses from the drop in Samyoung Electronics' long position.| Shinsegae Food vs. Hotel Shilla Co | Shinsegae Food vs. Heungkuk Metaltech CoLtd | Shinsegae Food vs. MEDIANA CoLtd | Shinsegae Food vs. Shinhan Inverse Copper |
| Samyoung Electronics vs. Korea Investment Holdings | Samyoung Electronics vs. Samlip General Foods | Samyoung Electronics vs. Hankook Furniture Co | Samyoung Electronics vs. Daol Investment Securities |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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