Correlation Between SK Holdings and INFINITT Healthcare
Can any of the company-specific risk be diversified away by investing in both SK Holdings and INFINITT Healthcare 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 SK Holdings and INFINITT Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Holdings Co and INFINITT Healthcare Co, you can compare the effects of market volatilities on SK Holdings and INFINITT Healthcare 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 SK Holdings with a short position of INFINITT Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Holdings and INFINITT Healthcare.
Diversification Opportunities for SK Holdings and INFINITT Healthcare
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between 034730 and INFINITT is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding SK Holdings Co and INFINITT Healthcare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INFINITT Healthcare and SK Holdings 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 SK Holdings Co are associated (or correlated) with INFINITT Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INFINITT Healthcare has no effect on the direction of SK Holdings i.e., SK Holdings and INFINITT Healthcare go up and down completely randomly.
Pair Corralation between SK Holdings and INFINITT Healthcare
Assuming the 90 days trading horizon SK Holdings Co is expected to generate 1.44 times more return on investment than INFINITT Healthcare. However, SK Holdings is 1.44 times more volatile than INFINITT Healthcare Co. It trades about -0.03 of its potential returns per unit of risk. INFINITT Healthcare Co is currently generating about -0.04 per unit of risk. If you would invest 16,929,100 in SK Holdings Co on September 12, 2024 and sell it today you would lose (3,679,100) from holding SK Holdings Co or give up 21.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Holdings Co vs. INFINITT Healthcare Co
Performance |
| Timeline |
| SK Holdings |
| INFINITT Healthcare |
SK Holdings and INFINITT Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Holdings and INFINITT Healthcare
The main advantage of trading using opposite SK Holdings and INFINITT Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Holdings position performs unexpectedly, INFINITT Healthcare 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 INFINITT Healthcare will offset losses from the drop in INFINITT Healthcare's long position.| SK Holdings vs. Korea New Network | SK Holdings vs. Solution Advanced Technology | SK Holdings vs. Busan Industrial Co | SK Holdings vs. Busan Ind |
| INFINITT Healthcare vs. Samsung Electronics Co | INFINITT Healthcare vs. Samsung Electronics Co | INFINITT Healthcare vs. SK Hynix | INFINITT Healthcare vs. SK Holdings 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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