Correlation Between Shinsegae Information and Wooyang
Can any of the company-specific risk be diversified away by investing in both Shinsegae Information and Wooyang 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 Wooyang 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 Wooyang Co, you can compare the effects of market volatilities on Shinsegae Information and Wooyang 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 Wooyang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsegae Information and Wooyang.
Diversification Opportunities for Shinsegae Information and Wooyang
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shinsegae and Wooyang is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Shinsegae Information Communic and Wooyang Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wooyang 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 Wooyang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wooyang has no effect on the direction of Shinsegae Information i.e., Shinsegae Information and Wooyang go up and down completely randomly.
Pair Corralation between Shinsegae Information and Wooyang
Assuming the 90 days trading horizon Shinsegae Information Communication is expected to under-perform the Wooyang. But the stock apears to be less risky and, when comparing its historical volatility, Shinsegae Information Communication is 1.96 times less risky than Wooyang. The stock trades about -0.07 of its potential returns per unit of risk. The Wooyang Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 336,500 in Wooyang Co on September 19, 2024 and sell it today you would lose (7,000) from holding Wooyang Co or give up 2.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shinsegae Information Communic vs. Wooyang Co
Performance |
| Timeline |
| Shinsegae Information |
| Wooyang |
Shinsegae Information and Wooyang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsegae Information and Wooyang
The main advantage of trading using opposite Shinsegae Information and Wooyang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsegae Information position performs unexpectedly, Wooyang 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 Wooyang will offset losses from the drop in Wooyang'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 |
| Wooyang vs. SungMoon Electronics Co | Wooyang vs. Sungmoon Electronics Co | Wooyang vs. Shinsegae Information Communication | Wooyang vs. KyungIn Electronics 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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