Correlation Between SCI Information and Jeong Moon
Can any of the company-specific risk be diversified away by investing in both SCI Information and Jeong Moon 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 SCI Information and Jeong Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCI Information Service and Jeong Moon Information, you can compare the effects of market volatilities on SCI Information and Jeong Moon 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 SCI Information with a short position of Jeong Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCI Information and Jeong Moon.
Diversification Opportunities for SCI Information and Jeong Moon
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SCI and Jeong is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding SCI Information Service and Jeong Moon Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeong Moon Information and SCI 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 SCI Information Service are associated (or correlated) with Jeong Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeong Moon Information has no effect on the direction of SCI Information i.e., SCI Information and Jeong Moon go up and down completely randomly.
Pair Corralation between SCI Information and Jeong Moon
Assuming the 90 days trading horizon SCI Information Service is expected to generate 0.73 times more return on investment than Jeong Moon. However, SCI Information Service is 1.38 times less risky than Jeong Moon. It trades about 0.16 of its potential returns per unit of risk. Jeong Moon Information is currently generating about -0.09 per unit of risk. If you would invest 202,500 in SCI Information Service on October 26, 2024 and sell it today you would earn a total of 25,000 from holding SCI Information Service or generate 12.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SCI Information Service vs. Jeong Moon Information
Performance |
| Timeline |
| SCI Information Service |
| Jeong Moon Information |
SCI Information and Jeong Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCI Information and Jeong Moon
The main advantage of trading using opposite SCI Information and Jeong Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCI Information position performs unexpectedly, Jeong Moon 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 Jeong Moon will offset losses from the drop in Jeong Moon's long position.| SCI Information vs. Samsung Electronics Co | SCI Information vs. Samsung Electronics Co | SCI Information vs. SK Hynix | SCI Information vs. HMM Co |
| Jeong Moon vs. PJ Electronics Co | Jeong Moon vs. Samsung Electronics Co | Jeong Moon vs. Anam Electronics Co | Jeong Moon vs. LG Electronics |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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