Correlation Between Koryo Credit and SCI Information
Can any of the company-specific risk be diversified away by investing in both Koryo Credit and SCI 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 Koryo Credit and SCI Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koryo Credit Information and SCI Information Service, you can compare the effects of market volatilities on Koryo Credit and SCI 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 Koryo Credit with a short position of SCI Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koryo Credit and SCI Information.
Diversification Opportunities for Koryo Credit and SCI Information
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Koryo and SCI is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and SCI Information Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCI Information Service and Koryo Credit 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 Koryo Credit Information are associated (or correlated) with SCI Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCI Information Service has no effect on the direction of Koryo Credit i.e., Koryo Credit and SCI Information go up and down completely randomly.
Pair Corralation between Koryo Credit and SCI Information
Assuming the 90 days trading horizon Koryo Credit Information is expected to generate 0.35 times more return on investment than SCI Information. However, Koryo Credit Information is 2.83 times less risky than SCI Information. It trades about -0.02 of its potential returns per unit of risk. SCI Information Service is currently generating about -0.15 per unit of risk. If you would invest 1,046,000 in Koryo Credit Information on September 2, 2024 and sell it today you would lose (15,000) from holding Koryo Credit Information or give up 1.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koryo Credit Information vs. SCI Information Service
Performance |
| Timeline |
| Koryo Credit Information |
| SCI Information Service |
Koryo Credit and SCI Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koryo Credit and SCI Information
The main advantage of trading using opposite Koryo Credit and SCI Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koryo Credit position performs unexpectedly, SCI 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 SCI Information will offset losses from the drop in SCI Information's long position.| Koryo Credit vs. Lotte Energy Materials | Koryo Credit vs. Lotte Data Communication | Koryo Credit vs. Nable Communications | Koryo Credit vs. Hana Materials |
| SCI Information vs. Samsung Electronics Co | SCI Information vs. Samsung Electronics Co | SCI Information vs. KB Financial Group | SCI Information vs. Shinhan Financial Group |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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