Correlation Between MEDICOX and Silla Sg
Can any of the company-specific risk be diversified away by investing in both MEDICOX and Silla Sg 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 MEDICOX and Silla Sg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDICOX Co and Silla Sg Co, you can compare the effects of market volatilities on MEDICOX and Silla Sg 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 MEDICOX with a short position of Silla Sg. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDICOX and Silla Sg.
Diversification Opportunities for MEDICOX and Silla Sg
Very good diversification
The 3 months correlation between MEDICOX and Silla is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding MEDICOX Co and Silla Sg Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silla Sg and MEDICOX 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 MEDICOX Co are associated (or correlated) with Silla Sg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silla Sg has no effect on the direction of MEDICOX i.e., MEDICOX and Silla Sg go up and down completely randomly.
Pair Corralation between MEDICOX and Silla Sg
Assuming the 90 days trading horizon MEDICOX Co is expected to under-perform the Silla Sg. But the stock apears to be less risky and, when comparing its historical volatility, MEDICOX Co is 1.39 times less risky than Silla Sg. The stock trades about -0.02 of its potential returns per unit of risk. The Silla Sg Co is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 584,000 in Silla Sg Co on September 19, 2024 and sell it today you would earn a total of 84,000 from holding Silla Sg Co or generate 14.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MEDICOX Co vs. Silla Sg Co
Performance |
| Timeline |
| MEDICOX |
| Silla Sg |
MEDICOX and Silla Sg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDICOX and Silla Sg
The main advantage of trading using opposite MEDICOX and Silla Sg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDICOX position performs unexpectedly, Silla Sg 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 Silla Sg will offset losses from the drop in Silla Sg's long position.| MEDICOX vs. HyVision System | MEDICOX vs. Vitzro Tech Co | MEDICOX vs. Solution Advanced Technology | MEDICOX vs. Busan Industrial Co |
| Silla Sg vs. Korea New Network | Silla Sg vs. ICD Co | Silla Sg vs. DYPNF CoLtd | Silla Sg vs. Solution Advanced Technology |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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