Correlation Between UNISEM and Shinhan Inverse
Can any of the company-specific risk be diversified away by investing in both UNISEM and Shinhan Inverse 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 UNISEM and Shinhan Inverse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UNISEM Co and Shinhan Inverse Dollar, you can compare the effects of market volatilities on UNISEM and Shinhan Inverse 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 UNISEM with a short position of Shinhan Inverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNISEM and Shinhan Inverse.
Diversification Opportunities for UNISEM and Shinhan Inverse
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between UNISEM and Shinhan is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding UNISEM Co and Shinhan Inverse Dollar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Inverse Dollar and UNISEM 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 UNISEM Co are associated (or correlated) with Shinhan Inverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Inverse Dollar has no effect on the direction of UNISEM i.e., UNISEM and Shinhan Inverse go up and down completely randomly.
Pair Corralation between UNISEM and Shinhan Inverse
Assuming the 90 days trading horizon UNISEM Co is expected to generate 5.81 times more return on investment than Shinhan Inverse. However, UNISEM is 5.81 times more volatile than Shinhan Inverse Dollar. It trades about 0.5 of its potential returns per unit of risk. Shinhan Inverse Dollar is currently generating about -0.25 per unit of risk. If you would invest 520,767 in UNISEM Co on October 9, 2024 and sell it today you would earn a total of 120,233 from holding UNISEM Co or generate 23.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
UNISEM Co vs. Shinhan Inverse Dollar
Performance |
| Timeline |
| UNISEM |
| Shinhan Inverse Dollar |
UNISEM and Shinhan Inverse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNISEM and Shinhan Inverse
The main advantage of trading using opposite UNISEM and Shinhan Inverse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNISEM position performs unexpectedly, Shinhan Inverse 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 Shinhan Inverse will offset losses from the drop in Shinhan Inverse's long position.| UNISEM vs. PI Advanced Materials | UNISEM vs. Wireless Power Amplifier | UNISEM vs. Mobileleader CoLtd | UNISEM vs. LAKE MATERIALS LTD |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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