Correlation Between Shinhan Financial and PLAYWITH
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and PLAYWITH 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 Shinhan Financial and PLAYWITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Financial Group and PLAYWITH, you can compare the effects of market volatilities on Shinhan Financial and PLAYWITH 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 Shinhan Financial with a short position of PLAYWITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and PLAYWITH.
Diversification Opportunities for Shinhan Financial and PLAYWITH
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinhan and PLAYWITH is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and PLAYWITH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYWITH and Shinhan Financial 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 Shinhan Financial Group are associated (or correlated) with PLAYWITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAYWITH has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and PLAYWITH go up and down completely randomly.
Pair Corralation between Shinhan Financial and PLAYWITH
Assuming the 90 days trading horizon Shinhan Financial Group is expected to under-perform the PLAYWITH. In addition to that, Shinhan Financial is 1.37 times more volatile than PLAYWITH. It trades about -0.21 of its total potential returns per unit of risk. PLAYWITH is currently generating about -0.22 per unit of volatility. If you would invest 374,500 in PLAYWITH on September 26, 2024 and sell it today you would lose (36,000) from holding PLAYWITH or give up 9.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Financial Group vs. PLAYWITH
Performance |
| Timeline |
| Shinhan Financial |
| PLAYWITH |
Shinhan Financial and PLAYWITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and PLAYWITH
The main advantage of trading using opposite Shinhan Financial and PLAYWITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, PLAYWITH 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 PLAYWITH will offset losses from the drop in PLAYWITH's long position.| Shinhan Financial vs. Samyang Foods Co | Shinhan Financial vs. Handok Clean Tech | Shinhan Financial vs. FOODWELL Co | Shinhan Financial vs. Lotte Non Life Insurance |
| PLAYWITH vs. Daol Investment Securities | PLAYWITH vs. KPX Green Chemical | PLAYWITH vs. Youngbo Chemical Co | PLAYWITH vs. Kyung In Synthetic Corp |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |