Correlation Between STI and Ssangyong Information
Can any of the company-specific risk be diversified away by investing in both STI and Ssangyong Information 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 STI and Ssangyong Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STI Co and Ssangyong Information Communication, you can compare the effects of market volatilities on STI and Ssangyong Information 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 STI with a short position of Ssangyong Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of STI and Ssangyong Information.
Diversification Opportunities for STI and Ssangyong Information
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between STI and Ssangyong is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding STI Co and Ssangyong Information Communic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ssangyong Information and STI 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 STI Co are associated (or correlated) with Ssangyong Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ssangyong Information has no effect on the direction of STI i.e., STI and Ssangyong Information go up and down completely randomly.
Pair Corralation between STI and Ssangyong Information
Assuming the 90 days trading horizon STI Co is expected to generate 2.78 times more return on investment than Ssangyong Information. However, STI is 2.78 times more volatile than Ssangyong Information Communication. It trades about 0.04 of its potential returns per unit of risk. Ssangyong Information Communication is currently generating about -0.07 per unit of risk. If you would invest 1,198,320 in STI Co on August 31, 2024 and sell it today you would earn a total of 331,680 from holding STI Co or generate 27.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
STI Co vs. Ssangyong Information Communic
Performance |
| Timeline |
| STI Co |
| Ssangyong Information |
STI and Ssangyong Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STI and Ssangyong Information
The main advantage of trading using opposite STI and Ssangyong Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STI position performs unexpectedly, Ssangyong Information 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 Ssangyong Information will offset losses from the drop in Ssangyong Information's long position.| STI vs. Ssangyong Information Communication | STI vs. Daishin Information Communications | STI vs. Daedong Metals Co | STI vs. Daesung Hi Tech Co |
| Ssangyong Information vs. Settlebank | Ssangyong Information vs. Daishin Information Communications | Ssangyong Information vs. Busan Industrial Co | Ssangyong Information vs. Busan Ind |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |