Correlation Between Shinsegae Information and Daehan Synthetic
Can any of the company-specific risk be diversified away by investing in both Shinsegae Information and Daehan Synthetic 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 Information and Daehan Synthetic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsegae Information Communication and Daehan Synthetic Fiber, you can compare the effects of market volatilities on Shinsegae Information and Daehan Synthetic 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 Information with a short position of Daehan Synthetic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Information and Daehan Synthetic.
Diversification Opportunities for Shinsegae Information and Daehan Synthetic
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinsegae and Daehan is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Information Communic and Daehan Synthetic Fiber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daehan Synthetic Fiber and Shinsegae 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 Shinsegae Information Communication are associated (or correlated) with Daehan Synthetic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daehan Synthetic Fiber has no effect on the direction of Shinsegae Information i.e., Shinsegae Information and Daehan Synthetic go up and down completely randomly.
Pair Corralation between Shinsegae Information and Daehan Synthetic
Assuming the 90 days trading horizon Shinsegae Information Communication is expected to under-perform the Daehan Synthetic. In addition to that, Shinsegae Information is 2.14 times more volatile than Daehan Synthetic Fiber. It trades about -0.36 of its total potential returns per unit of risk. Daehan Synthetic Fiber is currently generating about -0.08 per unit of volatility. If you would invest 11,800,000 in Daehan Synthetic Fiber on September 4, 2024 and sell it today you would lose (150,000) from holding Daehan Synthetic Fiber or give up 1.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinsegae Information Communic vs. Daehan Synthetic Fiber
Performance |
| Timeline |
| Shinsegae Information |
| Daehan Synthetic Fiber |
Shinsegae Information and Daehan Synthetic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Information and Daehan Synthetic
The main advantage of trading using opposite Shinsegae Information and Daehan Synthetic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Information position performs unexpectedly, Daehan Synthetic 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 Daehan Synthetic will offset losses from the drop in Daehan Synthetic's long position.| Shinsegae Information vs. DB Financial Investment | Shinsegae Information vs. Shinhan Financial Group | Shinsegae Information vs. Korean Reinsurance Co | Shinsegae Information vs. KakaoBank Corp |
| Daehan Synthetic vs. LG Display Co | Daehan Synthetic vs. Sangsin Energy Display | Daehan Synthetic vs. Okins Electronics Co | Daehan Synthetic vs. Visang Education |
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.
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