Correlation Between ITM Semiconductor and Shinil Industrial
Can any of the company-specific risk be diversified away by investing in both ITM Semiconductor and Shinil Industrial 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 ITM Semiconductor and Shinil Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ITM Semiconductor Co and Shinil Industrial Co, you can compare the effects of market volatilities on ITM Semiconductor and Shinil Industrial 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 ITM Semiconductor with a short position of Shinil Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITM Semiconductor and Shinil Industrial.
Diversification Opportunities for ITM Semiconductor and Shinil Industrial
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ITM and Shinil is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding ITM Semiconductor Co and Shinil Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinil Industrial and ITM Semiconductor 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 ITM Semiconductor Co are associated (or correlated) with Shinil Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinil Industrial has no effect on the direction of ITM Semiconductor i.e., ITM Semiconductor and Shinil Industrial go up and down completely randomly.
Pair Corralation between ITM Semiconductor and Shinil Industrial
Assuming the 90 days trading horizon ITM Semiconductor Co is expected to under-perform the Shinil Industrial. In addition to that, ITM Semiconductor is 5.31 times more volatile than Shinil Industrial Co. It trades about -0.23 of its total potential returns per unit of risk. Shinil Industrial Co is currently generating about -0.16 per unit of volatility. If you would invest 142,400 in Shinil Industrial Co on November 5, 2024 and sell it today you would lose (2,000) from holding Shinil Industrial Co or give up 1.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ITM Semiconductor Co vs. Shinil Industrial Co
Performance |
| Timeline |
| ITM Semiconductor |
| Shinil Industrial |
ITM Semiconductor and Shinil Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITM Semiconductor and Shinil Industrial
The main advantage of trading using opposite ITM Semiconductor and Shinil Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITM Semiconductor position performs unexpectedly, Shinil Industrial 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 Shinil Industrial will offset losses from the drop in Shinil Industrial's long position.| ITM Semiconductor vs. Nice Information Telecommunication | ITM Semiconductor vs. BIT Computer Co | ITM Semiconductor vs. Samsung Life Insurance | ITM Semiconductor vs. Dongwoon Anatech Co |
| Shinil Industrial vs. Samsung Electronics Co | Shinil Industrial vs. Samsung Electronics Co | Shinil Industrial vs. LG Energy Solution | Shinil Industrial vs. SK Hynix |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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