Correlation Between Phoenix Materials and Shinhan Financial
Can any of the company-specific risk be diversified away by investing in both Phoenix Materials 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 Phoenix Materials and Shinhan Financial 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 Shinhan Financial Group, you can compare the effects of market volatilities on Phoenix Materials 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 Phoenix Materials with a short position of Shinhan Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Materials and Shinhan Financial.
Diversification Opportunities for Phoenix Materials and Shinhan Financial
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Phoenix and Shinhan is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Phoenix Materials Co and Shinhan Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Financial 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 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 Phoenix Materials i.e., Phoenix Materials and Shinhan Financial go up and down completely randomly.
Pair Corralation between Phoenix Materials and Shinhan Financial
Assuming the 90 days trading horizon Phoenix Materials Co is expected to generate 1.92 times more return on investment than Shinhan Financial. However, Phoenix Materials is 1.92 times more volatile than Shinhan Financial Group. It trades about 0.0 of its potential returns per unit of risk. Shinhan Financial Group is currently generating about -0.04 per unit of risk. If you would invest 83,800 in Phoenix Materials Co on November 2, 2024 and sell it today you would lose (7,800) from holding Phoenix Materials Co or give up 9.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Phoenix Materials Co vs. Shinhan Financial Group
Performance |
| Timeline |
| Phoenix Materials |
| Shinhan Financial |
Phoenix Materials and Shinhan Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Materials and Shinhan Financial
The main advantage of trading using opposite Phoenix Materials and Shinhan Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Materials 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.| Phoenix Materials vs. Anam Electronics Co | Phoenix Materials vs. Mobileleader CoLtd | Phoenix Materials vs. Korea Information Communications | Phoenix Materials vs. Digital Power Communications |
| Shinhan Financial vs. KMH Hitech Co | Shinhan Financial vs. SS TECH | Shinhan Financial vs. Stic Investments | Shinhan Financial vs. SBI Investment KOREA |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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