Correlation Between BYON and Sam Chun
Can any of the company-specific risk be diversified away by investing in both BYON and Sam Chun 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 BYON and Sam Chun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BYON Co and Sam Chun Dang, you can compare the effects of market volatilities on BYON and Sam Chun 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 BYON with a short position of Sam Chun. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYON and Sam Chun.
Diversification Opportunities for BYON and Sam Chun
Very weak diversification
The 3 months correlation between BYON and Sam is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding BYON Co and Sam Chun Dang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sam Chun Dang and BYON 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 BYON Co are associated (or correlated) with Sam Chun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sam Chun Dang has no effect on the direction of BYON i.e., BYON and Sam Chun go up and down completely randomly.
Pair Corralation between BYON and Sam Chun
Assuming the 90 days trading horizon BYON Co is expected to under-perform the Sam Chun. But the stock apears to be less risky and, when comparing its historical volatility, BYON Co is 1.08 times less risky than Sam Chun. The stock trades about 0.0 of its potential returns per unit of risk. The Sam Chun Dang is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 6,630,000 in Sam Chun Dang on August 29, 2024 and sell it today you would earn a total of 3,850,000 from holding Sam Chun Dang or generate 58.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYON Co vs. Sam Chun Dang
Performance |
| Timeline |
| BYON |
| Sam Chun Dang |
BYON and Sam Chun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYON and Sam Chun
The main advantage of trading using opposite BYON and Sam Chun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYON position performs unexpectedly, Sam Chun 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 Sam Chun will offset losses from the drop in Sam Chun's long position.| BYON vs. Dongbang Ship Machinery | BYON vs. Camus Engineering Construction | BYON vs. ABOV Semiconductor Co | BYON vs. Alton Sports CoLtd |
| Sam Chun vs. Medy Tox | Sam Chun vs. Busan Industrial Co | Sam Chun vs. Busan Ind | Sam Chun vs. Mirae Asset Daewoo |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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