Correlation Between Shinsegae Information and KT Hitel
Can any of the company-specific risk be diversified away by investing in both Shinsegae Information and KT Hitel 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 KT Hitel 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 KT Hitel, you can compare the effects of market volatilities on Shinsegae Information and KT Hitel 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 KT Hitel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Information and KT Hitel.
Diversification Opportunities for Shinsegae Information and KT Hitel
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shinsegae and 036030 is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Information Communic and KT Hitel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Hitel 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 KT Hitel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Hitel has no effect on the direction of Shinsegae Information i.e., Shinsegae Information and KT Hitel go up and down completely randomly.
Pair Corralation between Shinsegae Information and KT Hitel
Assuming the 90 days trading horizon Shinsegae Information Communication is expected to under-perform the KT Hitel. In addition to that, Shinsegae Information is 1.07 times more volatile than KT Hitel. It trades about -0.28 of its total potential returns per unit of risk. KT Hitel is currently generating about -0.21 per unit of volatility. If you would invest 404,000 in KT Hitel on September 5, 2024 and sell it today you would lose (27,000) from holding KT Hitel or give up 6.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinsegae Information Communic vs. KT Hitel
Performance |
| Timeline |
| Shinsegae Information |
| KT Hitel |
Shinsegae Information and KT Hitel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Information and KT Hitel
The main advantage of trading using opposite Shinsegae Information and KT Hitel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Information position performs unexpectedly, KT Hitel 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 KT Hitel will offset losses from the drop in KT Hitel's long position.| Shinsegae Information vs. Korean Drug Co | Shinsegae Information vs. Shinsung Delta Tech | Shinsegae Information vs. Raontech | Shinsegae Information vs. Sungchang Autotech Co |
| KT Hitel vs. Samsung Electronics Co | KT Hitel vs. Samsung Electronics Co | KT Hitel vs. LG Energy Solution | KT Hitel vs. SK Hynix |
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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