Correlation Between Korea Electronic and Shinil Electronics
Can any of the company-specific risk be diversified away by investing in both Korea Electronic and Shinil 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 Korea Electronic and Shinil Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Electronic Certification and Shinil Electronics Co, you can compare the effects of market volatilities on Korea Electronic and Shinil 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 Korea Electronic with a short position of Shinil Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Electronic and Shinil Electronics.
Diversification Opportunities for Korea Electronic and Shinil Electronics
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Korea and Shinil is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Korea Electronic Certification and Shinil Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinil Electronics and Korea Electronic 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 Korea Electronic Certification are associated (or correlated) with Shinil Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinil Electronics has no effect on the direction of Korea Electronic i.e., Korea Electronic and Shinil Electronics go up and down completely randomly.
Pair Corralation between Korea Electronic and Shinil Electronics
Assuming the 90 days trading horizon Korea Electronic Certification is expected to under-perform the Shinil Electronics. In addition to that, Korea Electronic is 2.05 times more volatile than Shinil Electronics Co. It trades about -0.03 of its total potential returns per unit of risk. Shinil Electronics Co is currently generating about -0.04 per unit of volatility. If you would invest 189,927 in Shinil Electronics Co on September 2, 2024 and sell it today you would lose (44,427) from holding Shinil Electronics Co or give up 23.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Electronic Certification vs. Shinil Electronics Co
Performance |
| Timeline |
| Korea Electronic Cer |
| Shinil Electronics |
Korea Electronic and Shinil Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Electronic and Shinil Electronics
The main advantage of trading using opposite Korea Electronic and Shinil Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Electronic position performs unexpectedly, Shinil 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 Shinil Electronics will offset losses from the drop in Shinil Electronics' long position.| Korea Electronic vs. Korea New Network | Korea Electronic vs. ICD Co | Korea Electronic vs. DYPNF CoLtd | Korea Electronic vs. Busan Industrial Co |
| Shinil Electronics vs. LG Display | Shinil Electronics vs. Hyundai Motor Co | Shinil Electronics vs. Hyundai Motor Co | Shinil Electronics vs. Adaptive Plasma Technology |
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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