Correlation Between Shinsegae Engineering and Sangsangin Investment
Can any of the company-specific risk be diversified away by investing in both Shinsegae Engineering and Sangsangin Investment 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 Engineering and Sangsangin Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsegae Engineering Construction and Sangsangin Investment Securities, you can compare the effects of market volatilities on Shinsegae Engineering and Sangsangin Investment 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 Engineering with a short position of Sangsangin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Engineering and Sangsangin Investment.
Diversification Opportunities for Shinsegae Engineering and Sangsangin Investment
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shinsegae and Sangsangin is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Engineering Construc and Sangsangin Investment Securiti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangsangin Investment and Shinsegae Engineering 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 Engineering Construction are associated (or correlated) with Sangsangin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sangsangin Investment has no effect on the direction of Shinsegae Engineering i.e., Shinsegae Engineering and Sangsangin Investment go up and down completely randomly.
Pair Corralation between Shinsegae Engineering and Sangsangin Investment
Assuming the 90 days trading horizon Shinsegae Engineering Construction is expected to generate 0.09 times more return on investment than Sangsangin Investment. However, Shinsegae Engineering Construction is 11.71 times less risky than Sangsangin Investment. It trades about -0.18 of its potential returns per unit of risk. Sangsangin Investment Securities is currently generating about -0.13 per unit of risk. If you would invest 1,816,000 in Shinsegae Engineering Construction on August 29, 2024 and sell it today you would lose (14,000) from holding Shinsegae Engineering Construction or give up 0.77% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 97.5% |
Values | Daily Returns |
Shinsegae Engineering Construc vs. Sangsangin Investment Securiti
Performance |
Timeline |
Shinsegae Engineering |
Sangsangin Investment |
Shinsegae Engineering and Sangsangin Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shinsegae Engineering and Sangsangin Investment
The main advantage of trading using opposite Shinsegae Engineering and Sangsangin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Engineering position performs unexpectedly, Sangsangin Investment 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 Sangsangin Investment will offset losses from the drop in Sangsangin Investment's long position.Shinsegae Engineering vs. AptaBio Therapeutics | Shinsegae Engineering vs. Daewoo SBI SPAC | Shinsegae Engineering vs. Dream Security co | Shinsegae Engineering vs. Microfriend |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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