Correlation Between ChipsMedia and SBI Investment
Can any of the company-specific risk be diversified away by investing in both ChipsMedia and SBI Investment 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 ChipsMedia and SBI Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChipsMedia and SBI Investment KOREA, you can compare the effects of market volatilities on ChipsMedia and SBI Investment 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 ChipsMedia with a short position of SBI Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChipsMedia and SBI Investment.
Diversification Opportunities for ChipsMedia and SBI Investment
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between ChipsMedia and SBI is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding ChipsMedia and SBI Investment KOREA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Investment KOREA and ChipsMedia 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 ChipsMedia are associated (or correlated) with SBI Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Investment KOREA has no effect on the direction of ChipsMedia i.e., ChipsMedia and SBI Investment go up and down completely randomly.
Pair Corralation between ChipsMedia and SBI Investment
Assuming the 90 days trading horizon ChipsMedia is expected to under-perform the SBI Investment. In addition to that, ChipsMedia is 1.65 times more volatile than SBI Investment KOREA. It trades about -0.01 of its total potential returns per unit of risk. SBI Investment KOREA is currently generating about -0.01 per unit of volatility. If you would invest 97,800 in SBI Investment KOREA on September 12, 2024 and sell it today you would lose (21,900) from holding SBI Investment KOREA or give up 22.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChipsMedia vs. SBI Investment KOREA
Performance |
| Timeline |
| ChipsMedia |
| SBI Investment KOREA |
ChipsMedia and SBI Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChipsMedia and SBI Investment
The main advantage of trading using opposite ChipsMedia and SBI Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChipsMedia position performs unexpectedly, SBI Investment 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 SBI Investment will offset losses from the drop in SBI Investment's long position.| ChipsMedia vs. CG Hi Tech | ChipsMedia vs. Sejong Telecom | ChipsMedia vs. Korea Information Communications | ChipsMedia vs. Digital Power Communications |
| SBI Investment vs. KB Financial Group | SBI Investment vs. Shinhan Financial Group | SBI Investment vs. Hana Financial | SBI Investment 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |