Correlation Between Barunson Entertainment and Samhwa Paint
Can any of the company-specific risk be diversified away by investing in both Barunson Entertainment and Samhwa Paint 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 Barunson Entertainment and Samhwa Paint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barunson Entertainment Arts and Samhwa Paint Industrial, you can compare the effects of market volatilities on Barunson Entertainment and Samhwa Paint 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 Barunson Entertainment with a short position of Samhwa Paint. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barunson Entertainment and Samhwa Paint.
Diversification Opportunities for Barunson Entertainment and Samhwa Paint
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Barunson and Samhwa is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Barunson Entertainment Arts and Samhwa Paint Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhwa Paint Industrial and Barunson Entertainment 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 Barunson Entertainment Arts are associated (or correlated) with Samhwa Paint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhwa Paint Industrial has no effect on the direction of Barunson Entertainment i.e., Barunson Entertainment and Samhwa Paint go up and down completely randomly.
Pair Corralation between Barunson Entertainment and Samhwa Paint
Assuming the 90 days trading horizon Barunson Entertainment Arts is expected to under-perform the Samhwa Paint. In addition to that, Barunson Entertainment is 1.18 times more volatile than Samhwa Paint Industrial. It trades about -0.16 of its total potential returns per unit of risk. Samhwa Paint Industrial is currently generating about 0.55 per unit of volatility. If you would invest 613,000 in Samhwa Paint Industrial on November 29, 2024 and sell it today you would earn a total of 59,000 from holding Samhwa Paint Industrial or generate 9.62% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Barunson Entertainment Arts vs. Samhwa Paint Industrial
Performance |
Timeline |
Barunson Entertainment |
Samhwa Paint Industrial |
Barunson Entertainment and Samhwa Paint Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Barunson Entertainment and Samhwa Paint
The main advantage of trading using opposite Barunson Entertainment and Samhwa Paint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barunson Entertainment position performs unexpectedly, Samhwa Paint 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 Samhwa Paint will offset losses from the drop in Samhwa Paint's long position.Barunson Entertainment vs. Cots Technology Co | Barunson Entertainment vs. GAMEVIL | Barunson Entertainment vs. DoubleU Games Co | Barunson Entertainment vs. NewFlex Technology Co |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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