Correlation Between Shinsegae Information and Daewon Media
Can any of the company-specific risk be diversified away by investing in both Shinsegae Information and Daewon Media 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 Daewon Media 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 Daewon Media Co, you can compare the effects of market volatilities on Shinsegae Information and Daewon Media 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 Daewon Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Information and Daewon Media.
Diversification Opportunities for Shinsegae Information and Daewon Media
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shinsegae and Daewon is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Information Communic and Daewon Media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daewon Media 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 Daewon Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daewon Media has no effect on the direction of Shinsegae Information i.e., Shinsegae Information and Daewon Media go up and down completely randomly.
Pair Corralation between Shinsegae Information and Daewon Media
Assuming the 90 days trading horizon Shinsegae Information Communication is expected to generate 0.93 times more return on investment than Daewon Media. However, Shinsegae Information Communication is 1.07 times less risky than Daewon Media. It trades about -0.07 of its potential returns per unit of risk. Daewon Media Co is currently generating about -0.1 per unit of risk. If you would invest 1,407,847 in Shinsegae Information Communication on September 19, 2024 and sell it today you would lose (523,847) from holding Shinsegae Information Communication or give up 37.21% 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. Daewon Media Co
Performance |
| Timeline |
| Shinsegae Information |
| Daewon Media |
Shinsegae Information and Daewon Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Information and Daewon Media
The main advantage of trading using opposite Shinsegae Information and Daewon Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Information position performs unexpectedly, Daewon Media 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 Daewon Media will offset losses from the drop in Daewon Media's long position.| Shinsegae Information vs. Pureun Mutual Savings | Shinsegae Information vs. MediaZen | Shinsegae Information vs. Pan Entertainment Co | Shinsegae Information vs. Sangsangin Investment Securities |
| Daewon Media vs. Eugene Investment Securities | Daewon Media vs. DSC Investment | Daewon Media vs. Shinsegae Information Communication | Daewon Media vs. Daishin Information Communications |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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