Correlation Between GemVaxKAEL CoLtd and SIMMTECH
Can any of the company-specific risk be diversified away by investing in both GemVaxKAEL CoLtd and SIMMTECH 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 SIMMTECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GemVaxKAEL CoLtd and SIMMTECH Co, you can compare the effects of market volatilities on GemVaxKAEL CoLtd and SIMMTECH 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 SIMMTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of GemVaxKAEL CoLtd and SIMMTECH.
Diversification Opportunities for GemVaxKAEL CoLtd and SIMMTECH
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GemVaxKAEL and SIMMTECH is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding GemVaxKAEL CoLtd and SIMMTECH Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIMMTECH 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 SIMMTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIMMTECH has no effect on the direction of GemVaxKAEL CoLtd i.e., GemVaxKAEL CoLtd and SIMMTECH go up and down completely randomly.
Pair Corralation between GemVaxKAEL CoLtd and SIMMTECH
Assuming the 90 days trading horizon GemVaxKAEL CoLtd is expected to generate 0.74 times more return on investment than SIMMTECH. However, GemVaxKAEL CoLtd is 1.34 times less risky than SIMMTECH. It trades about 0.61 of its potential returns per unit of risk. SIMMTECH Co is currently generating about 0.34 per unit of risk. If you would invest 1,887,000 in GemVaxKAEL CoLtd on November 27, 2024 and sell it today you would earn a total of 1,588,000 from holding GemVaxKAEL CoLtd or generate 84.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GemVaxKAEL CoLtd vs. SIMMTECH Co
Performance |
| Timeline |
| GemVaxKAEL CoLtd |
| SIMMTECH |
GemVaxKAEL CoLtd and SIMMTECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GemVaxKAEL CoLtd and SIMMTECH
The main advantage of trading using opposite GemVaxKAEL CoLtd and SIMMTECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GemVaxKAEL CoLtd position performs unexpectedly, SIMMTECH 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 SIMMTECH will offset losses from the drop in SIMMTECH's long position.| GemVaxKAEL CoLtd vs. Hwangkum Steel Technology | GemVaxKAEL CoLtd vs. Echomarketing CoLtd | GemVaxKAEL CoLtd vs. Leaders Technology Investment | GemVaxKAEL CoLtd vs. SV Investment |
| SIMMTECH vs. SBI Investment KOREA | SIMMTECH vs. Keyang Electric Machinery | SIMMTECH vs. Korea Investment Holdings | SIMMTECH vs. Kyeryong Construction Industrial |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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