Correlation Between Samji Electronics and Daedong Metals
Can any of the company-specific risk be diversified away by investing in both Samji Electronics and Daedong Metals 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 Daedong Metals 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 Daedong Metals Co, you can compare the effects of market volatilities on Samji Electronics and Daedong Metals 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 Daedong Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samji Electronics and Daedong Metals.
Diversification Opportunities for Samji Electronics and Daedong Metals
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samji and Daedong is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Samji Electronics Co and Daedong Metals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daedong Metals 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 Daedong Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daedong Metals has no effect on the direction of Samji Electronics i.e., Samji Electronics and Daedong Metals go up and down completely randomly.
Pair Corralation between Samji Electronics and Daedong Metals
Assuming the 90 days trading horizon Samji Electronics Co is expected to generate 0.38 times more return on investment than Daedong Metals. However, Samji Electronics Co is 2.6 times less risky than Daedong Metals. It trades about 0.02 of its potential returns per unit of risk. Daedong Metals Co is currently generating about 0.0 per unit of risk. If you would invest 792,958 in Samji Electronics Co on September 1, 2024 and sell it today you would earn a total of 45,042 from holding Samji Electronics Co or generate 5.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samji Electronics Co vs. Daedong Metals Co
Performance |
| Timeline |
| Samji Electronics |
| Daedong Metals |
Samji Electronics and Daedong Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samji Electronics and Daedong Metals
The main advantage of trading using opposite Samji Electronics and Daedong Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samji Electronics position performs unexpectedly, Daedong Metals 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 Daedong Metals will offset losses from the drop in Daedong Metals' long position.| Samji Electronics vs. Dongsin Engineering Construction | Samji Electronics vs. Doosan Fuel Cell | Samji Electronics vs. Daishin Balance 1 | Samji Electronics vs. Total Soft Bank |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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