Correlation Between Shinsung Delta and Konan Technology
Can any of the company-specific risk be diversified away by investing in both Shinsung Delta and Konan Technology 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 Shinsung Delta and Konan Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsung Delta Tech and Konan Technology, you can compare the effects of market volatilities on Shinsung Delta and Konan Technology 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 Shinsung Delta with a short position of Konan Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsung Delta and Konan Technology.
Diversification Opportunities for Shinsung Delta and Konan Technology
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shinsung and Konan is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Shinsung Delta Tech and Konan Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konan Technology and Shinsung Delta 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 Shinsung Delta Tech are associated (or correlated) with Konan Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konan Technology has no effect on the direction of Shinsung Delta i.e., Shinsung Delta and Konan Technology go up and down completely randomly.
Pair Corralation between Shinsung Delta and Konan Technology
Assuming the 90 days trading horizon Shinsung Delta Tech is expected to under-perform the Konan Technology. But the stock apears to be less risky and, when comparing its historical volatility, Shinsung Delta Tech is 1.12 times less risky than Konan Technology. The stock trades about -0.29 of its potential returns per unit of risk. The Konan Technology is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 2,545,000 in Konan Technology on November 27, 2024 and sell it today you would lose (155,000) from holding Konan Technology or give up 6.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinsung Delta Tech vs. Konan Technology
Performance |
| Timeline |
| Shinsung Delta Tech |
| Konan Technology |
Shinsung Delta and Konan Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsung Delta and Konan Technology
The main advantage of trading using opposite Shinsung Delta and Konan Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsung Delta position performs unexpectedly, Konan Technology 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 Konan Technology will offset losses from the drop in Konan Technology's long position.| Shinsung Delta vs. Busan Industrial Co | Shinsung Delta vs. Busan Ind | Shinsung Delta vs. Mirae Asset Daewoo | Shinsung Delta vs. UNISEM Co |
| Konan Technology vs. LB Investment | Konan Technology vs. E Investment Development | Konan Technology vs. DB Financial Investment | Konan Technology vs. Daol Investment Securities |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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