Correlation Between Pan Entertainment and Sang A
Can any of the company-specific risk be diversified away by investing in both Pan Entertainment and Sang A 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 Pan Entertainment and Sang A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Entertainment Co and Sang A Frontec CoLtd, you can compare the effects of market volatilities on Pan Entertainment and Sang A 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 Pan Entertainment with a short position of Sang A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Entertainment and Sang A.
Diversification Opportunities for Pan Entertainment and Sang A
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pan and Sang is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Pan Entertainment Co and Sang A Frontec CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sang A Frontec and Pan Entertainment 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 Pan Entertainment Co are associated (or correlated) with Sang A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sang A Frontec has no effect on the direction of Pan Entertainment i.e., Pan Entertainment and Sang A go up and down completely randomly.
Pair Corralation between Pan Entertainment and Sang A
Assuming the 90 days trading horizon Pan Entertainment Co is expected to under-perform the Sang A. But the stock apears to be less risky and, when comparing its historical volatility, Pan Entertainment Co is 1.03 times less risky than Sang A. The stock trades about -0.06 of its potential returns per unit of risk. The Sang A Frontec CoLtd is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 3,036,620 in Sang A Frontec CoLtd on October 13, 2024 and sell it today you would lose (1,167,620) from holding Sang A Frontec CoLtd or give up 38.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pan Entertainment Co vs. Sang A Frontec CoLtd
Performance |
| Timeline |
| Pan Entertainment |
| Sang A Frontec |
Pan Entertainment and Sang A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Entertainment and Sang A
The main advantage of trading using opposite Pan Entertainment and Sang A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Entertainment position performs unexpectedly, Sang A 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 Sang A will offset losses from the drop in Sang A's long position.| Pan Entertainment vs. SeAH Besteel Corp | Pan Entertainment vs. Daechang Steel Co | Pan Entertainment vs. MediaZen | Pan Entertainment vs. Tway Air Co |
| Sang A vs. MediaZen | Sang A vs. Pan Entertainment Co | Sang A vs. SAMG Entertainment Co | Sang A vs. Lotte Data Communication |
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 CEOs Directory module to screen CEOs from public companies around the world.
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