Correlation Between SK Holdings and NH SPAC
Can any of the company-specific risk be diversified away by investing in both SK Holdings and NH SPAC 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 NH SPAC 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 NH SPAC 8, you can compare the effects of market volatilities on SK Holdings and NH SPAC 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 NH SPAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Holdings and NH SPAC.
Diversification Opportunities for SK Holdings and NH SPAC
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 034730 and 225570 is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding SK Holdings Co and NH SPAC 8 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH SPAC 8 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 NH SPAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH SPAC 8 has no effect on the direction of SK Holdings i.e., SK Holdings and NH SPAC go up and down completely randomly.
Pair Corralation between SK Holdings and NH SPAC
Assuming the 90 days trading horizon SK Holdings Co is expected to under-perform the NH SPAC. But the stock apears to be less risky and, when comparing its historical volatility, SK Holdings Co is 1.67 times less risky than NH SPAC. The stock trades about -0.01 of its potential returns per unit of risk. The NH SPAC 8 is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,330,000 in NH SPAC 8 on August 28, 2024 and sell it today you would earn a total of 57,000 from holding NH SPAC 8 or generate 4.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Holdings Co vs. NH SPAC 8
Performance |
| Timeline |
| SK Holdings |
| NH SPAC 8 |
SK Holdings and NH SPAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Holdings and NH SPAC
The main advantage of trading using opposite SK Holdings and NH SPAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Holdings position performs unexpectedly, NH SPAC 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 NH SPAC will offset losses from the drop in NH SPAC's long position.| SK Holdings vs. Samsung Electronics Co | SK Holdings vs. Samsung Electronics Co | SK Holdings vs. Hyundai Motor Co | SK Holdings vs. Hyundai Motor |
| NH SPAC vs. CJ Seafood Corp | NH SPAC vs. Wireless Power Amplifier | NH SPAC vs. Samlip General Foods | NH SPAC vs. LG Chemicals |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |