Correlation Between Sejong Telecom and Cytogen
Can any of the company-specific risk be diversified away by investing in both Sejong Telecom and Cytogen 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 Cytogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sejong Telecom and Cytogen, you can compare the effects of market volatilities on Sejong Telecom and Cytogen 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 Cytogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sejong Telecom and Cytogen.
Diversification Opportunities for Sejong Telecom and Cytogen
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sejong and Cytogen is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Sejong Telecom and Cytogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cytogen 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 Cytogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cytogen has no effect on the direction of Sejong Telecom i.e., Sejong Telecom and Cytogen go up and down completely randomly.
Pair Corralation between Sejong Telecom and Cytogen
Assuming the 90 days trading horizon Sejong Telecom is expected to generate 0.31 times more return on investment than Cytogen. However, Sejong Telecom is 3.23 times less risky than Cytogen. It trades about -0.49 of its potential returns per unit of risk. Cytogen is currently generating about -0.28 per unit of risk. If you would invest 49,500 in Sejong Telecom on September 4, 2024 and sell it today you would lose (6,400) from holding Sejong Telecom or give up 12.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sejong Telecom vs. Cytogen
Performance |
| Timeline |
| Sejong Telecom |
| Cytogen |
Sejong Telecom and Cytogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sejong Telecom and Cytogen
The main advantage of trading using opposite Sejong Telecom and Cytogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sejong Telecom position performs unexpectedly, Cytogen 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 Cytogen will offset losses from the drop in Cytogen's long position.| Sejong Telecom vs. Korea New Network | Sejong Telecom vs. ICD Co | Sejong Telecom vs. DYPNF CoLtd | Sejong Telecom vs. Busan Industrial Co |
| Cytogen vs. Sejong Telecom | Cytogen vs. Shinhan Inverse Silver | Cytogen vs. HB Technology TD | Cytogen vs. Dong A Steel Technology |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |