Correlation Between Sang A and Pureun Mutual
Can any of the company-specific risk be diversified away by investing in both Sang A and Pureun Mutual 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 Sang A and Pureun Mutual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sang A Frontec CoLtd and Pureun Mutual Savings, you can compare the effects of market volatilities on Sang A and Pureun Mutual 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 Sang A with a short position of Pureun Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sang A and Pureun Mutual.
Diversification Opportunities for Sang A and Pureun Mutual
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sang and Pureun is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Sang A Frontec CoLtd and Pureun Mutual Savings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pureun Mutual Savings and Sang A 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 Sang A Frontec CoLtd are associated (or correlated) with Pureun Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pureun Mutual Savings has no effect on the direction of Sang A i.e., Sang A and Pureun Mutual go up and down completely randomly.
Pair Corralation between Sang A and Pureun Mutual
Assuming the 90 days trading horizon Sang A Frontec CoLtd is expected to under-perform the Pureun Mutual. In addition to that, Sang A is 1.44 times more volatile than Pureun Mutual Savings. It trades about -0.04 of its total potential returns per unit of risk. Pureun Mutual Savings is currently generating about 0.05 per unit of volatility. If you would invest 862,000 in Pureun Mutual Savings on September 21, 2024 and sell it today you would earn a total of 77,000 from holding Pureun Mutual Savings or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.02% |
| Values | Daily Returns |
Sang A Frontec CoLtd vs. Pureun Mutual Savings
Performance |
| Timeline |
| Sang A Frontec |
| Pureun Mutual Savings |
Sang A and Pureun Mutual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sang A and Pureun Mutual
The main advantage of trading using opposite Sang A and Pureun Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sang A position performs unexpectedly, Pureun Mutual 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 Pureun Mutual will offset losses from the drop in Pureun Mutual's long position.| Sang A vs. Pureun Mutual Savings | Sang A vs. Dgb Financial | Sang A vs. Jeju Bank | Sang A vs. Daishin Information Communications |
| Pureun Mutual vs. KB Financial Group | Pureun Mutual vs. Shinhan Financial Group | Pureun Mutual vs. Hana Financial | Pureun Mutual vs. Woori Financial Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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