Correlation Between Shinsegae Food and Genie Music
Can any of the company-specific risk be diversified away by investing in both Shinsegae Food and Genie Music 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 Genie Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsegae Food and Genie Music, you can compare the effects of market volatilities on Shinsegae Food and Genie Music 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 Genie Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Food and Genie Music.
Diversification Opportunities for Shinsegae Food and Genie Music
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shinsegae and Genie is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Food and Genie Music in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genie Music 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 Genie Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genie Music has no effect on the direction of Shinsegae Food i.e., Shinsegae Food and Genie Music go up and down completely randomly.
Pair Corralation between Shinsegae Food and Genie Music
Assuming the 90 days trading horizon Shinsegae Food is expected to under-perform the Genie Music. In addition to that, Shinsegae Food is 1.44 times more volatile than Genie Music. It trades about -0.09 of its total potential returns per unit of risk. Genie Music is currently generating about -0.1 per unit of volatility. If you would invest 211,000 in Genie Music on November 1, 2024 and sell it today you would lose (7,500) from holding Genie Music or give up 3.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinsegae Food vs. Genie Music
Performance |
| Timeline |
| Shinsegae Food |
| Genie Music |
Shinsegae Food and Genie Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Food and Genie Music
The main advantage of trading using opposite Shinsegae Food and Genie Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Food position performs unexpectedly, Genie Music 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 Genie Music will offset losses from the drop in Genie Music's long position.| Shinsegae Food vs. Daejoo Electronic Materials | Shinsegae Food vs. Hana Materials | Shinsegae Food vs. LG Display Co | Shinsegae Food vs. PLAYWITH |
| Genie Music vs. Daou Data Corp | Genie Music vs. INFINITT Healthcare Co | Genie Music vs. ITM Semiconductor Co | Genie Music vs. Daishin Information Communications |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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