Correlation Between Woori Technology and Samhyun Steel
Can any of the company-specific risk be diversified away by investing in both Woori Technology and Samhyun Steel 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 Woori Technology and Samhyun Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Technology Investment and Samhyun Steel Co, you can compare the effects of market volatilities on Woori Technology and Samhyun Steel 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 Woori Technology with a short position of Samhyun Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and Samhyun Steel.
Diversification Opportunities for Woori Technology and Samhyun Steel
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Woori and Samhyun is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology Investment and Samhyun Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhyun Steel and Woori Technology 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 Woori Technology Investment are associated (or correlated) with Samhyun Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhyun Steel has no effect on the direction of Woori Technology i.e., Woori Technology and Samhyun Steel go up and down completely randomly.
Pair Corralation between Woori Technology and Samhyun Steel
Assuming the 90 days trading horizon Woori Technology Investment is expected to under-perform the Samhyun Steel. In addition to that, Woori Technology is 3.7 times more volatile than Samhyun Steel Co. It trades about -0.02 of its total potential returns per unit of risk. Samhyun Steel Co is currently generating about -0.03 per unit of volatility. If you would invest 439,807 in Samhyun Steel Co on October 26, 2024 and sell it today you would lose (11,807) from holding Samhyun Steel Co or give up 2.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Technology Investment vs. Samhyun Steel Co
Performance |
| Timeline |
| Woori Technology Inv |
| Samhyun Steel |
Woori Technology and Samhyun Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and Samhyun Steel
The main advantage of trading using opposite Woori Technology and Samhyun Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology position performs unexpectedly, Samhyun Steel 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 Samhyun Steel will offset losses from the drop in Samhyun Steel's long position.| Woori Technology vs. Humasis Co | Woori Technology vs. JUSUNG ENGINEERING Co | Woori Technology vs. Winix Inc | Woori Technology vs. AfreecaTV Co |
| Samhyun Steel vs. DSC Investment | Samhyun Steel vs. E Investment Development | Samhyun Steel vs. Woori Technology Investment | Samhyun Steel vs. Coloray International Investment |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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