Correlation Between Sungdo Engineering and Koryo Credit
Can any of the company-specific risk be diversified away by investing in both Sungdo Engineering and Koryo Credit 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 Sungdo Engineering and Koryo Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sungdo Engineering Construction and Koryo Credit Information, you can compare the effects of market volatilities on Sungdo Engineering and Koryo Credit 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 Sungdo Engineering with a short position of Koryo Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungdo Engineering and Koryo Credit.
Diversification Opportunities for Sungdo Engineering and Koryo Credit
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sungdo and Koryo is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sungdo Engineering Constructio and Koryo Credit Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koryo Credit Information and Sungdo Engineering 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 Sungdo Engineering Construction are associated (or correlated) with Koryo Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koryo Credit Information has no effect on the direction of Sungdo Engineering i.e., Sungdo Engineering and Koryo Credit go up and down completely randomly.
Pair Corralation between Sungdo Engineering and Koryo Credit
Assuming the 90 days trading horizon Sungdo Engineering is expected to generate 1.31 times less return on investment than Koryo Credit. In addition to that, Sungdo Engineering is 2.56 times more volatile than Koryo Credit Information. It trades about 0.02 of its total potential returns per unit of risk. Koryo Credit Information is currently generating about 0.06 per unit of volatility. If you would invest 899,385 in Koryo Credit Information on September 2, 2024 and sell it today you would earn a total of 131,615 from holding Koryo Credit Information or generate 14.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sungdo Engineering Constructio vs. Koryo Credit Information
Performance |
| Timeline |
| Sungdo Engineering |
| Koryo Credit Information |
Sungdo Engineering and Koryo Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sungdo Engineering and Koryo Credit
The main advantage of trading using opposite Sungdo Engineering and Koryo Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungdo Engineering position performs unexpectedly, Koryo Credit 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 Koryo Credit will offset losses from the drop in Koryo Credit's long position.| Sungdo Engineering vs. Korea New Network | Sungdo Engineering vs. ICD Co | Sungdo Engineering vs. DYPNF CoLtd | Sungdo Engineering vs. Busan Industrial Co |
| Koryo Credit vs. Lotte Energy Materials | Koryo Credit vs. Lotte Data Communication | Koryo Credit vs. Nable Communications | Koryo Credit vs. Hana Materials |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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