Correlation Between Phoenix Materials and Myoung Shin
Can any of the company-specific risk be diversified away by investing in both Phoenix Materials and Myoung Shin 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 Phoenix Materials and Myoung Shin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phoenix Materials Co and Myoung Shin Industrial, you can compare the effects of market volatilities on Phoenix Materials and Myoung Shin 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 Phoenix Materials with a short position of Myoung Shin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Materials and Myoung Shin.
Diversification Opportunities for Phoenix Materials and Myoung Shin
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Phoenix and Myoung is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Phoenix Materials Co and Myoung Shin Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Myoung Shin Industrial and Phoenix Materials 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 Phoenix Materials Co are associated (or correlated) with Myoung Shin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Myoung Shin Industrial has no effect on the direction of Phoenix Materials i.e., Phoenix Materials and Myoung Shin go up and down completely randomly.
Pair Corralation between Phoenix Materials and Myoung Shin
Assuming the 90 days trading horizon Phoenix Materials Co is expected to under-perform the Myoung Shin. In addition to that, Phoenix Materials is 1.66 times more volatile than Myoung Shin Industrial. It trades about -0.02 of its total potential returns per unit of risk. Myoung Shin Industrial is currently generating about -0.01 per unit of volatility. If you would invest 1,579,827 in Myoung Shin Industrial on September 12, 2024 and sell it today you would lose (467,827) from holding Myoung Shin Industrial or give up 29.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 96.27% |
| Values | Daily Returns |
Phoenix Materials Co vs. Myoung Shin Industrial
Performance |
| Timeline |
| Phoenix Materials |
| Myoung Shin Industrial |
Phoenix Materials and Myoung Shin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Materials and Myoung Shin
The main advantage of trading using opposite Phoenix Materials and Myoung Shin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Materials position performs unexpectedly, Myoung Shin 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 Myoung Shin will offset losses from the drop in Myoung Shin's long position.| Phoenix Materials vs. Organic Special Pet | Phoenix Materials vs. Infinitt Healthcare Co | Phoenix Materials vs. CKH Food Health | Phoenix Materials vs. CJ Seafood Corp |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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