Correlation Between NewFlex Technology and Sung Bo
Can any of the company-specific risk be diversified away by investing in both NewFlex Technology and Sung Bo 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 NewFlex Technology and Sung Bo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NewFlex Technology Co and Sung Bo Chemicals, you can compare the effects of market volatilities on NewFlex Technology and Sung Bo 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 NewFlex Technology with a short position of Sung Bo. Check out your portfolio center. Please also check ongoing floating volatility patterns of NewFlex Technology and Sung Bo.
Diversification Opportunities for NewFlex Technology and Sung Bo
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NewFlex and Sung is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding NewFlex Technology Co and Sung Bo Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sung Bo Chemicals and NewFlex Technology 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 NewFlex Technology Co are associated (or correlated) with Sung Bo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sung Bo Chemicals has no effect on the direction of NewFlex Technology i.e., NewFlex Technology and Sung Bo go up and down completely randomly.
Pair Corralation between NewFlex Technology and Sung Bo
Assuming the 90 days trading horizon NewFlex Technology Co is expected to under-perform the Sung Bo. In addition to that, NewFlex Technology is 4.48 times more volatile than Sung Bo Chemicals. It trades about -0.27 of its total potential returns per unit of risk. Sung Bo Chemicals is currently generating about 0.0 per unit of volatility. If you would invest 250,000 in Sung Bo Chemicals on November 6, 2024 and sell it today you would earn a total of 0.00 from holding Sung Bo Chemicals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NewFlex Technology Co vs. Sung Bo Chemicals
Performance |
| Timeline |
| NewFlex Technology |
| Sung Bo Chemicals |
NewFlex Technology and Sung Bo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NewFlex Technology and Sung Bo
The main advantage of trading using opposite NewFlex Technology and Sung Bo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NewFlex Technology position performs unexpectedly, Sung Bo 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 Sung Bo will offset losses from the drop in Sung Bo's long position.| NewFlex Technology vs. Korea Investment Holdings | NewFlex Technology vs. Tuksu Engineering ConstructionLtd | NewFlex Technology vs. Dongkuk Structures Construction | NewFlex Technology vs. Jeju Beer Co |
| Sung Bo vs. Miwon Chemicals Co | Sung Bo vs. Samyang Foods Co | Sung Bo vs. Nice Information Telecommunication | Sung Bo vs. CKH Food Health |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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