Correlation Between Seohee Construction and Korea Gas
Can any of the company-specific risk be diversified away by investing in both Seohee Construction and Korea Gas 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 Seohee Construction and Korea Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seohee Construction Co and Korea Gas, you can compare the effects of market volatilities on Seohee Construction and Korea Gas 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 Seohee Construction with a short position of Korea Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seohee Construction and Korea Gas.
Diversification Opportunities for Seohee Construction and Korea Gas
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Seohee and Korea is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Seohee Construction Co and Korea Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Gas and Seohee Construction 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 Seohee Construction Co are associated (or correlated) with Korea Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Gas has no effect on the direction of Seohee Construction i.e., Seohee Construction and Korea Gas go up and down completely randomly.
Pair Corralation between Seohee Construction and Korea Gas
Assuming the 90 days trading horizon Seohee Construction is expected to generate 2.97 times less return on investment than Korea Gas. But when comparing it to its historical volatility, Seohee Construction Co is 1.98 times less risky than Korea Gas. It trades about 0.03 of its potential returns per unit of risk. Korea Gas is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,116,965 in Korea Gas on August 27, 2024 and sell it today you would earn a total of 1,518,035 from holding Korea Gas or generate 48.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seohee Construction Co vs. Korea Gas
Performance |
| Timeline |
| Seohee Construction |
| Korea Gas |
Seohee Construction and Korea Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seohee Construction and Korea Gas
The main advantage of trading using opposite Seohee Construction and Korea Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seohee Construction position performs unexpectedly, Korea Gas 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 Korea Gas will offset losses from the drop in Korea Gas' long position.| Seohee Construction vs. KCC Engineering Construction | Seohee Construction vs. Samchuly Bicycle Co | Seohee Construction vs. SFA Engineering | Seohee Construction vs. SEOHAN Const EngcoLtd |
| Korea Gas vs. KB Financial Group | Korea Gas vs. Shinhan Financial Group | Korea Gas vs. Hana Financial | Korea Gas vs. Woori Financial Group |
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.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |