Correlation Between Sungchang Autotech and Wonik QnC
Can any of the company-specific risk be diversified away by investing in both Sungchang Autotech and Wonik QnC 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 Sungchang Autotech and Wonik QnC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sungchang Autotech Co and Wonik QnC, you can compare the effects of market volatilities on Sungchang Autotech and Wonik QnC 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 Sungchang Autotech with a short position of Wonik QnC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungchang Autotech and Wonik QnC.
Diversification Opportunities for Sungchang Autotech and Wonik QnC
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sungchang and Wonik is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sungchang Autotech Co and Wonik QnC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonik QnC and Sungchang Autotech 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 Sungchang Autotech Co are associated (or correlated) with Wonik QnC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonik QnC has no effect on the direction of Sungchang Autotech i.e., Sungchang Autotech and Wonik QnC go up and down completely randomly.
Pair Corralation between Sungchang Autotech and Wonik QnC
Assuming the 90 days trading horizon Sungchang Autotech Co is expected to generate 0.96 times more return on investment than Wonik QnC. However, Sungchang Autotech Co is 1.04 times less risky than Wonik QnC. It trades about -0.17 of its potential returns per unit of risk. Wonik QnC is currently generating about -0.39 per unit of risk. If you would invest 430,500 in Sungchang Autotech Co on September 1, 2024 and sell it today you would lose (46,000) from holding Sungchang Autotech Co or give up 10.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sungchang Autotech Co vs. Wonik QnC
Performance |
| Timeline |
| Sungchang Autotech |
| Wonik QnC |
Sungchang Autotech and Wonik QnC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sungchang Autotech and Wonik QnC
The main advantage of trading using opposite Sungchang Autotech and Wonik QnC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungchang Autotech position performs unexpectedly, Wonik QnC 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 Wonik QnC will offset losses from the drop in Wonik QnC's long position.| Sungchang Autotech vs. Konan Technology | Sungchang Autotech vs. Korea Shipbuilding Offshore | Sungchang Autotech vs. Nasmedia Co | Sungchang Autotech vs. JYP Entertainment Corp |
| Wonik QnC vs. Dongsin Engineering Construction | Wonik QnC vs. Doosan Fuel Cell | Wonik QnC vs. Daishin Balance 1 | Wonik QnC vs. Total Soft Bank |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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