Correlation Between LG Display and SAMYOUNG M
Can any of the company-specific risk be diversified away by investing in both LG Display and SAMYOUNG M 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 LG Display and SAMYOUNG M into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LG Display and SAMYOUNG M Tek Co, you can compare the effects of market volatilities on LG Display and SAMYOUNG M 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 LG Display with a short position of SAMYOUNG M. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG Display and SAMYOUNG M.
Diversification Opportunities for LG Display and SAMYOUNG M
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 034220 and SAMYOUNG is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding LG Display and SAMYOUNG M Tek Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAMYOUNG M Tek and LG Display 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 LG Display are associated (or correlated) with SAMYOUNG M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAMYOUNG M Tek has no effect on the direction of LG Display i.e., LG Display and SAMYOUNG M go up and down completely randomly.
Pair Corralation between LG Display and SAMYOUNG M
Assuming the 90 days trading horizon LG Display is expected to under-perform the SAMYOUNG M. But the stock apears to be less risky and, when comparing its historical volatility, LG Display is 1.73 times less risky than SAMYOUNG M. The stock trades about -0.3 of its potential returns per unit of risk. The SAMYOUNG M Tek Co is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 413,500 in SAMYOUNG M Tek Co on September 3, 2024 and sell it today you would earn a total of 15,000 from holding SAMYOUNG M Tek Co or generate 3.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LG Display vs. SAMYOUNG M Tek Co
Performance |
| Timeline |
| LG Display |
| SAMYOUNG M Tek |
LG Display and SAMYOUNG M Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LG Display and SAMYOUNG M
The main advantage of trading using opposite LG Display and SAMYOUNG M positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG Display position performs unexpectedly, SAMYOUNG M 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 M will offset losses from the drop in SAMYOUNG M's long position.| LG Display vs. Cuckoo Homesys Co | LG Display vs. Duksan Hi Metal | LG Display vs. Youngsin Metal Industrial | LG Display vs. PJ Metal Co |
| SAMYOUNG M vs. LG Display | SAMYOUNG M vs. Hyundai Motor | SAMYOUNG M vs. Hyundai Motor Co | SAMYOUNG M vs. Hyundai Motor Co |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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