Correlation Between Samji Electronics and Sungmoon Electronics
Can any of the company-specific risk be diversified away by investing in both Samji Electronics and Sungmoon 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 Samji Electronics and Sungmoon Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samji Electronics Co and Sungmoon Electronics Co, you can compare the effects of market volatilities on Samji Electronics and Sungmoon 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 Samji Electronics with a short position of Sungmoon Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samji Electronics and Sungmoon Electronics.
Diversification Opportunities for Samji Electronics and Sungmoon Electronics
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samji and Sungmoon is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Samji Electronics Co and Sungmoon Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sungmoon Electronics and Samji Electronics 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 Samji Electronics Co are associated (or correlated) with Sungmoon Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sungmoon Electronics has no effect on the direction of Samji Electronics i.e., Samji Electronics and Sungmoon Electronics go up and down completely randomly.
Pair Corralation between Samji Electronics and Sungmoon Electronics
Assuming the 90 days trading horizon Samji Electronics is expected to generate 1.01 times less return on investment than Sungmoon Electronics. But when comparing it to its historical volatility, Samji Electronics Co is 4.47 times less risky than Sungmoon Electronics. It trades about 0.35 of its potential returns per unit of risk. Sungmoon Electronics Co is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 453,000 in Sungmoon Electronics Co on November 5, 2024 and sell it today you would earn a total of 19,000 from holding Sungmoon Electronics Co or generate 4.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samji Electronics Co vs. Sungmoon Electronics Co
Performance |
| Timeline |
| Samji Electronics |
| Sungmoon Electronics |
Samji Electronics and Sungmoon Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samji Electronics and Sungmoon Electronics
The main advantage of trading using opposite Samji Electronics and Sungmoon Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samji Electronics position performs unexpectedly, Sungmoon 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 Sungmoon Electronics will offset losses from the drop in Sungmoon Electronics' long position.| Samji Electronics vs. SFA Semicon Co | Samji Electronics vs. Seronics Co | Samji Electronics vs. COWELL FASHION CoLtd | Samji Electronics vs. Seohee Construction Co |
| Sungmoon Electronics vs. SK IE Technology | Sungmoon Electronics vs. Solus Advanced Materials | Sungmoon Electronics vs. DAEDUCK ELECTRONICS CoLtd | Sungmoon Electronics vs. Iljin Display |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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