Correlation Between Sangsin Energy and PLAYWITH
Can any of the company-specific risk be diversified away by investing in both Sangsin Energy and PLAYWITH 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 Sangsin Energy and PLAYWITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sangsin Energy Display and PLAYWITH, you can compare the effects of market volatilities on Sangsin Energy and PLAYWITH 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 Sangsin Energy with a short position of PLAYWITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sangsin Energy and PLAYWITH.
Diversification Opportunities for Sangsin Energy and PLAYWITH
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sangsin and PLAYWITH is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sangsin Energy Display and PLAYWITH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYWITH and Sangsin Energy 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 Sangsin Energy Display are associated (or correlated) with PLAYWITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAYWITH has no effect on the direction of Sangsin Energy i.e., Sangsin Energy and PLAYWITH go up and down completely randomly.
Pair Corralation between Sangsin Energy and PLAYWITH
Assuming the 90 days trading horizon Sangsin Energy Display is expected to under-perform the PLAYWITH. But the stock apears to be less risky and, when comparing its historical volatility, Sangsin Energy Display is 1.39 times less risky than PLAYWITH. The stock trades about -0.12 of its potential returns per unit of risk. The PLAYWITH is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 590,000 in PLAYWITH on September 4, 2024 and sell it today you would lose (217,500) from holding PLAYWITH or give up 36.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sangsin Energy Display vs. PLAYWITH
Performance |
| Timeline |
| Sangsin Energy Display |
| PLAYWITH |
Sangsin Energy and PLAYWITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sangsin Energy and PLAYWITH
The main advantage of trading using opposite Sangsin Energy and PLAYWITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sangsin Energy position performs unexpectedly, PLAYWITH 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 PLAYWITH will offset losses from the drop in PLAYWITH's long position.| Sangsin Energy vs. InfoBank | Sangsin Energy vs. Ssangyong Information Communication | Sangsin Energy vs. Daou Data Corp | Sangsin Energy vs. KB Financial Group |
| PLAYWITH vs. Green Cross Medical | PLAYWITH vs. Cheryong Industrial CoLtd | PLAYWITH vs. Sam Yang Foods | PLAYWITH vs. Namhwa Industrial Co |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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