Correlation Between Shinsegae Food and Alton Sports
Can any of the company-specific risk be diversified away by investing in both Shinsegae Food and Alton Sports 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 Alton Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsegae Food and Alton Sports CoLtd, you can compare the effects of market volatilities on Shinsegae Food and Alton Sports 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 Alton Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Food and Alton Sports.
Diversification Opportunities for Shinsegae Food and Alton Sports
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shinsegae and Alton is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Food and Alton Sports CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alton Sports CoLtd 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 Alton Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alton Sports CoLtd has no effect on the direction of Shinsegae Food i.e., Shinsegae Food and Alton Sports go up and down completely randomly.
Pair Corralation between Shinsegae Food and Alton Sports
Assuming the 90 days trading horizon Shinsegae Food is expected to generate 0.95 times more return on investment than Alton Sports. However, Shinsegae Food is 1.05 times less risky than Alton Sports. It trades about -0.12 of its potential returns per unit of risk. Alton Sports CoLtd is currently generating about -0.26 per unit of risk. If you would invest 3,330,000 in Shinsegae Food on September 13, 2024 and sell it today you would lose (195,000) from holding Shinsegae Food or give up 5.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shinsegae Food vs. Alton Sports CoLtd
Performance |
| Timeline |
| Shinsegae Food |
| Alton Sports CoLtd |
Shinsegae Food and Alton Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Food and Alton Sports
The main advantage of trading using opposite Shinsegae Food and Alton Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Food position performs unexpectedly, Alton Sports 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 Alton Sports will offset losses from the drop in Alton Sports' long position.| Shinsegae Food vs. Daou Data Corp | Shinsegae Food vs. Solution Advanced Technology | Shinsegae Food vs. Busan Industrial Co | Shinsegae Food vs. Busan Ind |
| Alton Sports vs. Daou Data Corp | Alton Sports vs. Solution Advanced Technology | Alton Sports vs. Busan Industrial Co | Alton Sports vs. Busan Ind |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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