Correlation Between GemVaxKAEL CoLtd and Sangsangin Investment
Can any of the company-specific risk be diversified away by investing in both GemVaxKAEL CoLtd and Sangsangin Investment 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 GemVaxKAEL CoLtd and Sangsangin Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GemVaxKAEL CoLtd and Sangsangin Investment Securities, you can compare the effects of market volatilities on GemVaxKAEL CoLtd and Sangsangin Investment 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 GemVaxKAEL CoLtd with a short position of Sangsangin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of GemVaxKAEL CoLtd and Sangsangin Investment.
Diversification Opportunities for GemVaxKAEL CoLtd and Sangsangin Investment
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GemVaxKAEL and Sangsangin is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding GemVaxKAEL CoLtd and Sangsangin Investment Securiti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangsangin Investment and GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd are associated (or correlated) with Sangsangin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sangsangin Investment has no effect on the direction of GemVaxKAEL CoLtd i.e., GemVaxKAEL CoLtd and Sangsangin Investment go up and down completely randomly.
Pair Corralation between GemVaxKAEL CoLtd and Sangsangin Investment
Assuming the 90 days trading horizon GemVaxKAEL CoLtd is expected to generate 3.77 times more return on investment than Sangsangin Investment. However, GemVaxKAEL CoLtd is 3.77 times more volatile than Sangsangin Investment Securities. It trades about 0.12 of its potential returns per unit of risk. Sangsangin Investment Securities is currently generating about -0.09 per unit of risk. If you would invest 1,329,000 in GemVaxKAEL CoLtd on October 25, 2024 and sell it today you would earn a total of 477,000 from holding GemVaxKAEL CoLtd or generate 35.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GemVaxKAEL CoLtd vs. Sangsangin Investment Securiti
Performance |
| Timeline |
| GemVaxKAEL CoLtd |
| Sangsangin Investment |
GemVaxKAEL CoLtd and Sangsangin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GemVaxKAEL CoLtd and Sangsangin Investment
The main advantage of trading using opposite GemVaxKAEL CoLtd and Sangsangin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GemVaxKAEL CoLtd position performs unexpectedly, Sangsangin Investment 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 Sangsangin Investment will offset losses from the drop in Sangsangin Investment's long position.| GemVaxKAEL CoLtd vs. Sangsangin Investment Securities | GemVaxKAEL CoLtd vs. E Investment Development | GemVaxKAEL CoLtd vs. Youngbo Chemical Co | GemVaxKAEL CoLtd vs. TS Investment Corp |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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