Correlation Between Wonbang Tech and Shinhan Inverse
Can any of the company-specific risk be diversified away by investing in both Wonbang Tech and Shinhan Inverse 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 Wonbang Tech and Shinhan Inverse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wonbang Tech Co and Shinhan Inverse Copper, you can compare the effects of market volatilities on Wonbang Tech and Shinhan Inverse 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 Wonbang Tech with a short position of Shinhan Inverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonbang Tech and Shinhan Inverse.
Diversification Opportunities for Wonbang Tech and Shinhan Inverse
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wonbang and Shinhan is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Wonbang Tech Co and Shinhan Inverse Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Inverse Copper and Wonbang Tech 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 Wonbang Tech Co are associated (or correlated) with Shinhan Inverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Inverse Copper has no effect on the direction of Wonbang Tech i.e., Wonbang Tech and Shinhan Inverse go up and down completely randomly.
Pair Corralation between Wonbang Tech and Shinhan Inverse
Assuming the 90 days trading horizon Wonbang Tech Co is expected to under-perform the Shinhan Inverse. In addition to that, Wonbang Tech is 1.94 times more volatile than Shinhan Inverse Copper. It trades about -0.18 of its total potential returns per unit of risk. Shinhan Inverse Copper is currently generating about 0.21 per unit of volatility. If you would invest 535,000 in Shinhan Inverse Copper on August 29, 2024 and sell it today you would earn a total of 32,500 from holding Shinhan Inverse Copper or generate 6.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Wonbang Tech Co vs. Shinhan Inverse Copper
Performance |
| Timeline |
| Wonbang Tech |
| Shinhan Inverse Copper |
Wonbang Tech and Shinhan Inverse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonbang Tech and Shinhan Inverse
The main advantage of trading using opposite Wonbang Tech and Shinhan Inverse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonbang Tech position performs unexpectedly, Shinhan Inverse 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 Inverse will offset losses from the drop in Shinhan Inverse's long position.| Wonbang Tech vs. Lotte Non Life Insurance | Wonbang Tech vs. InfoBank | Wonbang Tech vs. Heungkuk Metaltech CoLtd | Wonbang Tech vs. Total Soft Bank |
| Shinhan Inverse vs. AptaBio Therapeutics | Shinhan Inverse vs. Daewoo SBI SPAC | Shinhan Inverse vs. Dream Security co | Shinhan Inverse vs. Microfriend |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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