Correlation Between Seoul Semiconductor and Samhyun Steel
Can any of the company-specific risk be diversified away by investing in both Seoul Semiconductor 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 Seoul Semiconductor and Samhyun Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seoul Semiconductor Co and Samhyun Steel Co, you can compare the effects of market volatilities on Seoul Semiconductor 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 Seoul Semiconductor with a short position of Samhyun Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seoul Semiconductor and Samhyun Steel.
Diversification Opportunities for Seoul Semiconductor and Samhyun Steel
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Seoul and Samhyun is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Seoul Semiconductor Co and Samhyun Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhyun Steel and Seoul Semiconductor 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 Seoul Semiconductor Co 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 Seoul Semiconductor i.e., Seoul Semiconductor and Samhyun Steel go up and down completely randomly.
Pair Corralation between Seoul Semiconductor and Samhyun Steel
Assuming the 90 days trading horizon Seoul Semiconductor Co is expected to generate 2.69 times more return on investment than Samhyun Steel. However, Seoul Semiconductor is 2.69 times more volatile than Samhyun Steel Co. It trades about -0.11 of its potential returns per unit of risk. Samhyun Steel Co is currently generating about -0.58 per unit of risk. If you would invest 746,000 in Seoul Semiconductor Co on November 7, 2024 and sell it today you would lose (25,000) from holding Seoul Semiconductor Co or give up 3.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 89.47% |
| Values | Daily Returns |
Seoul Semiconductor Co vs. Samhyun Steel Co
Performance |
| Timeline |
| Seoul Semiconductor |
| Samhyun Steel |
Seoul Semiconductor and Samhyun Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seoul Semiconductor and Samhyun Steel
The main advantage of trading using opposite Seoul Semiconductor and Samhyun Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seoul Semiconductor 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.The idea behind Seoul Semiconductor Co and Samhyun Steel Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Samhyun Steel vs. Ewon Comfortech Co | Samhyun Steel vs. Dongwoon Anatech Co | Samhyun Steel vs. Wonbang Tech Co | Samhyun Steel vs. Dgb Financial |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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