Correlation Between Eagle Veterinary and Shinhan Financial
Can any of the company-specific risk be diversified away by investing in both Eagle Veterinary and Shinhan Financial 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 Eagle Veterinary and Shinhan Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Veterinary Technology and Shinhan Financial Group, you can compare the effects of market volatilities on Eagle Veterinary and Shinhan Financial 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 Eagle Veterinary with a short position of Shinhan Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Veterinary and Shinhan Financial.
Diversification Opportunities for Eagle Veterinary and Shinhan Financial
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eagle and Shinhan is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Veterinary Technology and Shinhan Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Financial and Eagle Veterinary 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 Eagle Veterinary Technology are associated (or correlated) with Shinhan Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Financial has no effect on the direction of Eagle Veterinary i.e., Eagle Veterinary and Shinhan Financial go up and down completely randomly.
Pair Corralation between Eagle Veterinary and Shinhan Financial
Assuming the 90 days trading horizon Eagle Veterinary Technology is expected to under-perform the Shinhan Financial. But the stock apears to be less risky and, when comparing its historical volatility, Eagle Veterinary Technology is 1.33 times less risky than Shinhan Financial. The stock trades about -0.04 of its potential returns per unit of risk. The Shinhan Financial Group is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 4,460,716 in Shinhan Financial Group on September 3, 2024 and sell it today you would earn a total of 929,284 from holding Shinhan Financial Group or generate 20.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Veterinary Technology vs. Shinhan Financial Group
Performance |
| Timeline |
| Eagle Veterinary Tec |
| Shinhan Financial |
Eagle Veterinary and Shinhan Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Veterinary and Shinhan Financial
The main advantage of trading using opposite Eagle Veterinary and Shinhan Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Veterinary position performs unexpectedly, Shinhan Financial 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 Shinhan Financial will offset losses from the drop in Shinhan Financial's long position.| Eagle Veterinary vs. Kolon Life Science | Eagle Veterinary vs. JETEMA Co | Eagle Veterinary vs. Aminologics CoLtd | Eagle Veterinary vs. Daihan Pharmaceutical CoLtd |
| Shinhan Financial vs. Dongil Technology | Shinhan Financial vs. Jeong Moon Information | Shinhan Financial vs. Koh Young Technology | Shinhan Financial vs. Eugene Technology CoLtd |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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