Correlation Between Innowireless and Seojin Automotive
Can any of the company-specific risk be diversified away by investing in both Innowireless and Seojin Automotive 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 Innowireless and Seojin Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innowireless Co and Seojin Automotive CoLtd, you can compare the effects of market volatilities on Innowireless and Seojin Automotive 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 Innowireless with a short position of Seojin Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innowireless and Seojin Automotive.
Diversification Opportunities for Innowireless and Seojin Automotive
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Innowireless and Seojin is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Innowireless Co and Seojin Automotive CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seojin Automotive CoLtd and Innowireless 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 Innowireless Co are associated (or correlated) with Seojin Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seojin Automotive CoLtd has no effect on the direction of Innowireless i.e., Innowireless and Seojin Automotive go up and down completely randomly.
Pair Corralation between Innowireless and Seojin Automotive
Assuming the 90 days trading horizon Innowireless Co is expected to generate 0.98 times more return on investment than Seojin Automotive. However, Innowireless Co is 1.03 times less risky than Seojin Automotive. It trades about -0.01 of its potential returns per unit of risk. Seojin Automotive CoLtd is currently generating about -0.08 per unit of risk. If you would invest 2,225,000 in Innowireless Co on September 12, 2024 and sell it today you would lose (321,000) from holding Innowireless Co or give up 14.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.8% |
| Values | Daily Returns |
Innowireless Co vs. Seojin Automotive CoLtd
Performance |
| Timeline |
| Innowireless |
| Seojin Automotive CoLtd |
Innowireless and Seojin Automotive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innowireless and Seojin Automotive
The main advantage of trading using opposite Innowireless and Seojin Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innowireless position performs unexpectedly, Seojin Automotive 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 Seojin Automotive will offset losses from the drop in Seojin Automotive's long position.| Innowireless vs. Samsung Electronics Co | Innowireless vs. Samsung Electronics Co | Innowireless vs. SK Hynix | Innowireless vs. POSCO Holdings |
| Seojin Automotive vs. Innowireless Co | Seojin Automotive vs. Moonbae Steel | Seojin Automotive vs. Fine Besteel Co | Seojin Automotive vs. Jeil Steel Mfg |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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