Correlation Between Osang Healthcare and Samyoung Electronics
Can any of the company-specific risk be diversified away by investing in both Osang Healthcare and Samyoung Electronics 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 Osang Healthcare and Samyoung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Osang Healthcare Co,Ltd and Samyoung Electronics Co, you can compare the effects of market volatilities on Osang Healthcare and Samyoung Electronics 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 Osang Healthcare with a short position of Samyoung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osang Healthcare and Samyoung Electronics.
Diversification Opportunities for Osang Healthcare and Samyoung Electronics
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Osang and Samyoung is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Osang Healthcare Co,Ltd and Samyoung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyoung Electronics and Osang Healthcare 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 Osang Healthcare Co,Ltd are associated (or correlated) with Samyoung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyoung Electronics has no effect on the direction of Osang Healthcare i.e., Osang Healthcare and Samyoung Electronics go up and down completely randomly.
Pair Corralation between Osang Healthcare and Samyoung Electronics
Assuming the 90 days trading horizon Osang Healthcare Co,Ltd is expected to generate 2.65 times more return on investment than Samyoung Electronics. However, Osang Healthcare is 2.65 times more volatile than Samyoung Electronics Co. It trades about -0.03 of its potential returns per unit of risk. Samyoung Electronics Co is currently generating about -0.21 per unit of risk. If you would invest 1,186,000 in Osang Healthcare Co,Ltd on September 13, 2024 and sell it today you would lose (38,000) from holding Osang Healthcare Co,Ltd or give up 3.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Osang Healthcare Co,Ltd vs. Samyoung Electronics Co
Performance |
| Timeline |
| Osang Healthcare Co,Ltd |
| Samyoung Electronics |
Osang Healthcare and Samyoung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Osang Healthcare and Samyoung Electronics
The main advantage of trading using opposite Osang Healthcare and Samyoung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osang Healthcare position performs unexpectedly, Samyoung Electronics 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 Samyoung Electronics will offset losses from the drop in Samyoung Electronics' long position.| Osang Healthcare vs. Samsung Electronics Co | Osang Healthcare vs. Samsung Electronics Co | Osang Healthcare vs. LG Energy Solution | Osang Healthcare vs. SK Hynix |
| Samyoung Electronics vs. Ssangyong Information Communication | Samyoung Electronics vs. TOPMATERIAL LTD | Samyoung Electronics vs. Kisan Telecom Co | Samyoung Electronics vs. Ssangyong Materials Corp |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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