Correlation Between ABOV Semiconductor and Shinhan Inverse
Can any of the company-specific risk be diversified away by investing in both ABOV Semiconductor and Shinhan Inverse 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 ABOV Semiconductor and Shinhan Inverse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABOV Semiconductor Co and Shinhan Inverse Silver, you can compare the effects of market volatilities on ABOV Semiconductor and Shinhan Inverse 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 ABOV Semiconductor with a short position of Shinhan Inverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABOV Semiconductor and Shinhan Inverse.
Diversification Opportunities for ABOV Semiconductor and Shinhan Inverse
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ABOV and Shinhan is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding ABOV Semiconductor Co and Shinhan Inverse Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Inverse Silver and ABOV Semiconductor 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 ABOV Semiconductor Co are associated (or correlated) with Shinhan Inverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Inverse Silver has no effect on the direction of ABOV Semiconductor i.e., ABOV Semiconductor and Shinhan Inverse go up and down completely randomly.
Pair Corralation between ABOV Semiconductor and Shinhan Inverse
Assuming the 90 days trading horizon ABOV Semiconductor Co is expected to generate 2.54 times more return on investment than Shinhan Inverse. However, ABOV Semiconductor is 2.54 times more volatile than Shinhan Inverse Silver. It trades about 0.15 of its potential returns per unit of risk. Shinhan Inverse Silver is currently generating about -0.18 per unit of risk. If you would invest 885,000 in ABOV Semiconductor Co on November 9, 2024 and sell it today you would earn a total of 110,000 from holding ABOV Semiconductor Co or generate 12.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABOV Semiconductor Co vs. Shinhan Inverse Silver
Performance |
| Timeline |
| ABOV Semiconductor |
| Shinhan Inverse Silver |
ABOV Semiconductor and Shinhan Inverse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABOV Semiconductor and Shinhan Inverse
The main advantage of trading using opposite ABOV Semiconductor and Shinhan Inverse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABOV Semiconductor position performs unexpectedly, Shinhan Inverse 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 Shinhan Inverse will offset losses from the drop in Shinhan Inverse's long position.| ABOV Semiconductor vs. PlayD Co | ABOV Semiconductor vs. LG Display Co | ABOV Semiconductor vs. PLAYWITH | ABOV Semiconductor vs. Iljin Display |
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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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