Correlation Between SS TECH and Taegu Broadcasting
Can any of the company-specific risk be diversified away by investing in both SS TECH and Taegu Broadcasting 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 SS TECH and Taegu Broadcasting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SS TECH and Taegu Broadcasting, you can compare the effects of market volatilities on SS TECH and Taegu Broadcasting 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 SS TECH with a short position of Taegu Broadcasting. Check out your portfolio center. Please also check ongoing floating volatility patterns of SS TECH and Taegu Broadcasting.
Diversification Opportunities for SS TECH and Taegu Broadcasting
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 101490 and Taegu is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding SS TECH and Taegu Broadcasting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taegu Broadcasting and SS TECH 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 SS TECH are associated (or correlated) with Taegu Broadcasting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taegu Broadcasting has no effect on the direction of SS TECH i.e., SS TECH and Taegu Broadcasting go up and down completely randomly.
Pair Corralation between SS TECH and Taegu Broadcasting
Assuming the 90 days trading horizon SS TECH is expected to generate 2.5 times more return on investment than Taegu Broadcasting. However, SS TECH is 2.5 times more volatile than Taegu Broadcasting. It trades about 0.0 of its potential returns per unit of risk. Taegu Broadcasting is currently generating about -0.06 per unit of risk. If you would invest 2,320,000 in SS TECH on August 30, 2024 and sell it today you would lose (35,000) from holding SS TECH or give up 1.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SS TECH vs. Taegu Broadcasting
Performance |
| Timeline |
| SS TECH |
| Taegu Broadcasting |
SS TECH and Taegu Broadcasting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SS TECH and Taegu Broadcasting
The main advantage of trading using opposite SS TECH and Taegu Broadcasting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SS TECH position performs unexpectedly, Taegu Broadcasting 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 Taegu Broadcasting will offset losses from the drop in Taegu Broadcasting's long position.| SS TECH vs. Daou Data Corp | SS TECH vs. Busan Industrial Co | SS TECH vs. Busan Ind | SS TECH vs. Shinhan WTI Futures |
| Taegu Broadcasting vs. Korea New Network | Taegu Broadcasting vs. Busan Industrial Co | Taegu Broadcasting vs. Busan Ind | Taegu Broadcasting vs. Shinhan WTI Futures |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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