Correlation Between ENF Technology and Samhwa Paint
Can any of the company-specific risk be diversified away by investing in both ENF Technology and Samhwa Paint 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 ENF Technology and Samhwa Paint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ENF Technology Co and Samhwa Paint Industrial, you can compare the effects of market volatilities on ENF Technology and Samhwa Paint 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 ENF Technology with a short position of Samhwa Paint. Check out your portfolio center. Please also check ongoing floating volatility patterns of ENF Technology and Samhwa Paint.
Diversification Opportunities for ENF Technology and Samhwa Paint
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ENF and Samhwa is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding ENF Technology Co and Samhwa Paint Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhwa Paint Industrial and ENF Technology 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 ENF Technology Co are associated (or correlated) with Samhwa Paint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhwa Paint Industrial has no effect on the direction of ENF Technology i.e., ENF Technology and Samhwa Paint go up and down completely randomly.
Pair Corralation between ENF Technology and Samhwa Paint
Assuming the 90 days trading horizon ENF Technology is expected to generate 5.35 times less return on investment than Samhwa Paint. But when comparing it to its historical volatility, ENF Technology Co is 1.05 times less risky than Samhwa Paint. It trades about 0.0 of its potential returns per unit of risk. Samhwa Paint Industrial is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 565,701 in Samhwa Paint Industrial on October 14, 2024 and sell it today you would earn a total of 61,299 from holding Samhwa Paint Industrial or generate 10.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ENF Technology Co vs. Samhwa Paint Industrial
Performance |
| Timeline |
| ENF Technology |
| Samhwa Paint Industrial |
ENF Technology and Samhwa Paint Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ENF Technology and Samhwa Paint
The main advantage of trading using opposite ENF Technology and Samhwa Paint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ENF Technology position performs unexpectedly, Samhwa Paint 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 Samhwa Paint will offset losses from the drop in Samhwa Paint's long position.| ENF Technology vs. Dongjin Semichem Co | ENF Technology vs. SS TECH | ENF Technology vs. Tokai Carbon Korea | ENF Technology vs. Soulbrain Holdings Co |
| Samhwa Paint vs. ENF Technology Co | Samhwa Paint vs. Daou Technology | Samhwa Paint vs. KTB Investment Securities | Samhwa Paint vs. Global Standard Technology |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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