Correlation Between Sewoon Medical and Kaonmedia
Can any of the company-specific risk be diversified away by investing in both Sewoon Medical and Kaonmedia 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 Sewoon Medical and Kaonmedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sewoon Medical Co and Kaonmedia Co, you can compare the effects of market volatilities on Sewoon Medical and Kaonmedia 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 Sewoon Medical with a short position of Kaonmedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sewoon Medical and Kaonmedia.
Diversification Opportunities for Sewoon Medical and Kaonmedia
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sewoon and Kaonmedia is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Sewoon Medical Co and Kaonmedia Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaonmedia and Sewoon Medical 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 Sewoon Medical Co are associated (or correlated) with Kaonmedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaonmedia has no effect on the direction of Sewoon Medical i.e., Sewoon Medical and Kaonmedia go up and down completely randomly.
Pair Corralation between Sewoon Medical and Kaonmedia
Assuming the 90 days trading horizon Sewoon Medical Co is expected to generate 0.57 times more return on investment than Kaonmedia. However, Sewoon Medical Co is 1.74 times less risky than Kaonmedia. It trades about -0.11 of its potential returns per unit of risk. Kaonmedia Co is currently generating about -0.14 per unit of risk. If you would invest 281,000 in Sewoon Medical Co on September 3, 2024 and sell it today you would lose (27,000) from holding Sewoon Medical Co or give up 9.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sewoon Medical Co vs. Kaonmedia Co
Performance |
| Timeline |
| Sewoon Medical |
| Kaonmedia |
Sewoon Medical and Kaonmedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sewoon Medical and Kaonmedia
The main advantage of trading using opposite Sewoon Medical and Kaonmedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sewoon Medical position performs unexpectedly, Kaonmedia 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 Kaonmedia will offset losses from the drop in Kaonmedia's long position.| Sewoon Medical vs. Mgame Corp | Sewoon Medical vs. RFTech Co | Sewoon Medical vs. Yura Tech Co | Sewoon Medical vs. Intellian Technologies |
| Kaonmedia vs. Dongsin Engineering Construction | Kaonmedia vs. Doosan Fuel Cell | Kaonmedia vs. Daishin Balance 1 | Kaonmedia vs. Total Soft Bank |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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