Correlation Between Sejong Telecom and Pharmicell
Can any of the company-specific risk be diversified away by investing in both Sejong Telecom and Pharmicell 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 Sejong Telecom and Pharmicell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sejong Telecom and Pharmicell, you can compare the effects of market volatilities on Sejong Telecom and Pharmicell 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 Sejong Telecom with a short position of Pharmicell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sejong Telecom and Pharmicell.
Diversification Opportunities for Sejong Telecom and Pharmicell
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sejong and Pharmicell is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sejong Telecom and Pharmicell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pharmicell and Sejong Telecom 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 Sejong Telecom are associated (or correlated) with Pharmicell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pharmicell has no effect on the direction of Sejong Telecom i.e., Sejong Telecom and Pharmicell go up and down completely randomly.
Pair Corralation between Sejong Telecom and Pharmicell
Assuming the 90 days trading horizon Sejong Telecom is expected to under-perform the Pharmicell. But the stock apears to be less risky and, when comparing its historical volatility, Sejong Telecom is 1.01 times less risky than Pharmicell. The stock trades about -0.01 of its potential returns per unit of risk. The Pharmicell is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 930,000 in Pharmicell on October 29, 2024 and sell it today you would lose (13,000) from holding Pharmicell or give up 1.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.09% |
| Values | Daily Returns |
Sejong Telecom vs. Pharmicell
Performance |
| Timeline |
| Sejong Telecom |
| Pharmicell |
Sejong Telecom and Pharmicell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sejong Telecom and Pharmicell
The main advantage of trading using opposite Sejong Telecom and Pharmicell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sejong Telecom position performs unexpectedly, Pharmicell 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 Pharmicell will offset losses from the drop in Pharmicell's long position.| Sejong Telecom vs. Sam Chun Dang | Sejong Telecom vs. SAMRYOONG CoLtd | Sejong Telecom vs. BYON Co | Sejong Telecom vs. Sangsangin Co |
| Pharmicell vs. Hanmi Semiconductor Co | Pharmicell vs. PJ Metal Co | Pharmicell vs. Industrial Bank | Pharmicell vs. Sejong Telecom |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |