Correlation Between Sewoon Medical and SV Investment
Can any of the company-specific risk be diversified away by investing in both Sewoon Medical and SV 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 Sewoon Medical and SV Investment 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 SV Investment, you can compare the effects of market volatilities on Sewoon Medical and SV 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 Sewoon Medical with a short position of SV Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sewoon Medical and SV Investment.
Diversification Opportunities for Sewoon Medical and SV Investment
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sewoon and 289080 is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Sewoon Medical Co and SV Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SV Investment 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 SV Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SV Investment has no effect on the direction of Sewoon Medical i.e., Sewoon Medical and SV Investment go up and down completely randomly.
Pair Corralation between Sewoon Medical and SV Investment
Assuming the 90 days trading horizon Sewoon Medical is expected to generate 5.93 times less return on investment than SV Investment. But when comparing it to its historical volatility, Sewoon Medical Co is 2.68 times less risky than SV Investment. It trades about 0.13 of its potential returns per unit of risk. SV Investment is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 129,400 in SV Investment on November 29, 2024 and sell it today you would earn a total of 16,400 from holding SV Investment or generate 12.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sewoon Medical Co vs. SV Investment
Performance |
| Timeline |
| Sewoon Medical |
| SV Investment |
Sewoon Medical and SV Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sewoon Medical and SV Investment
The main advantage of trading using opposite Sewoon Medical and SV Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sewoon Medical position performs unexpectedly, SV 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 SV Investment will offset losses from the drop in SV Investment's long position.| Sewoon Medical vs. Samyang Foods Co | Sewoon Medical vs. Mirai Semiconductors Co | Sewoon Medical vs. Samyung Trading Co | Sewoon Medical vs. EBEST Investment Securities |
| SV Investment vs. Samhyun Steel Co | SV Investment vs. Dongil Steel Co | SV Investment vs. Husteel | SV Investment vs. Echomarketing CoLtd |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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