Correlation Between Korea Investment and Samyung Trading
Can any of the company-specific risk be diversified away by investing in both Korea Investment and Samyung Trading 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 Korea Investment and Samyung Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Investment Holdings and Samyung Trading Co, you can compare the effects of market volatilities on Korea Investment and Samyung Trading 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 Korea Investment with a short position of Samyung Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Investment and Samyung Trading.
Diversification Opportunities for Korea Investment and Samyung Trading
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Korea and Samyung is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Korea Investment Holdings and Samyung Trading Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyung Trading and Korea Investment 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 Korea Investment Holdings are associated (or correlated) with Samyung Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyung Trading has no effect on the direction of Korea Investment i.e., Korea Investment and Samyung Trading go up and down completely randomly.
Pair Corralation between Korea Investment and Samyung Trading
Assuming the 90 days trading horizon Korea Investment Holdings is expected to generate 1.6 times more return on investment than Samyung Trading. However, Korea Investment is 1.6 times more volatile than Samyung Trading Co. It trades about 0.04 of its potential returns per unit of risk. Samyung Trading Co is currently generating about 0.02 per unit of risk. If you would invest 4,324,670 in Korea Investment Holdings on August 24, 2024 and sell it today you would earn a total of 1,045,330 from holding Korea Investment Holdings or generate 24.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Investment Holdings vs. Samyung Trading Co
Performance |
| Timeline |
| Korea Investment Holdings |
| Samyung Trading |
Korea Investment and Samyung Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Investment and Samyung Trading
The main advantage of trading using opposite Korea Investment and Samyung Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Investment position performs unexpectedly, Samyung Trading 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 Samyung Trading will offset losses from the drop in Samyung Trading's long position.| Korea Investment vs. AptaBio Therapeutics | Korea Investment vs. Daewoo SBI SPAC | Korea Investment vs. Dream Security co | Korea Investment vs. Microfriend |
| Samyung Trading vs. AptaBio Therapeutics | Samyung Trading vs. Daewoo SBI SPAC | Samyung Trading vs. Dream Security co | Samyung Trading 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |