Correlation Between Insung Information and Shinsegae Food
Can any of the company-specific risk be diversified away by investing in both Insung Information and Shinsegae Food 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 Insung Information and Shinsegae Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Insung Information Co and Shinsegae Food, you can compare the effects of market volatilities on Insung Information and Shinsegae Food 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 Insung Information with a short position of Shinsegae Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Insung Information and Shinsegae Food.
Diversification Opportunities for Insung Information and Shinsegae Food
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Insung and Shinsegae is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Insung Information Co and Shinsegae Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinsegae Food and Insung Information 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 Insung Information Co are associated (or correlated) with Shinsegae Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinsegae Food has no effect on the direction of Insung Information i.e., Insung Information and Shinsegae Food go up and down completely randomly.
Pair Corralation between Insung Information and Shinsegae Food
Assuming the 90 days trading horizon Insung Information Co is expected to generate 0.76 times more return on investment than Shinsegae Food. However, Insung Information Co is 1.31 times less risky than Shinsegae Food. It trades about 0.17 of its potential returns per unit of risk. Shinsegae Food is currently generating about -0.26 per unit of risk. If you would invest 174,800 in Insung Information Co on October 28, 2024 and sell it today you would earn a total of 13,500 from holding Insung Information Co or generate 7.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Insung Information Co vs. Shinsegae Food
Performance |
| Timeline |
| Insung Information |
| Shinsegae Food |
Insung Information and Shinsegae Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Insung Information and Shinsegae Food
The main advantage of trading using opposite Insung Information and Shinsegae Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Insung Information position performs unexpectedly, Shinsegae Food 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 Shinsegae Food will offset losses from the drop in Shinsegae Food's long position.| Insung Information vs. Namhae Chemical | Insung Information vs. N2Tech Co | Insung Information vs. Wireless Power Amplifier | Insung Information vs. iNtRON Biotechnology |
| Shinsegae Food vs. Woori Technology Investment | Shinsegae Food vs. Samyung Trading Co | Shinsegae Food vs. Coloray International Investment | Shinsegae Food vs. DB Financial Investment |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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