Correlation Between Kolon Life and Sinil Pharmaceutical
Can any of the company-specific risk be diversified away by investing in both Kolon Life and Sinil Pharmaceutical 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 Kolon Life and Sinil Pharmaceutical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kolon Life Science and Sinil Pharmaceutical Co, you can compare the effects of market volatilities on Kolon Life and Sinil Pharmaceutical 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 Kolon Life with a short position of Sinil Pharmaceutical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kolon Life and Sinil Pharmaceutical.
Diversification Opportunities for Kolon Life and Sinil Pharmaceutical
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kolon and Sinil is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Kolon Life Science and Sinil Pharmaceutical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinil Pharmaceutical and Kolon Life 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 Kolon Life Science are associated (or correlated) with Sinil Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinil Pharmaceutical has no effect on the direction of Kolon Life i.e., Kolon Life and Sinil Pharmaceutical go up and down completely randomly.
Pair Corralation between Kolon Life and Sinil Pharmaceutical
Assuming the 90 days trading horizon Kolon Life Science is expected to under-perform the Sinil Pharmaceutical. In addition to that, Kolon Life is 1.43 times more volatile than Sinil Pharmaceutical Co. It trades about -0.09 of its total potential returns per unit of risk. Sinil Pharmaceutical Co is currently generating about 0.15 per unit of volatility. If you would invest 643,000 in Sinil Pharmaceutical Co on October 31, 2024 and sell it today you would earn a total of 26,000 from holding Sinil Pharmaceutical Co or generate 4.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kolon Life Science vs. Sinil Pharmaceutical Co
Performance |
| Timeline |
| Kolon Life Science |
| Sinil Pharmaceutical |
Kolon Life and Sinil Pharmaceutical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kolon Life and Sinil Pharmaceutical
The main advantage of trading using opposite Kolon Life and Sinil Pharmaceutical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kolon Life position performs unexpectedly, Sinil Pharmaceutical 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 Sinil Pharmaceutical will offset losses from the drop in Sinil Pharmaceutical's long position.| Kolon Life vs. DB Financial Investment | Kolon Life vs. Finebesteel | Kolon Life vs. Seah Steel Corp | Kolon Life vs. Atinum Investment Co |
| Sinil Pharmaceutical vs. Kisan Telecom Co | Sinil Pharmaceutical vs. iNtRON Biotechnology | Sinil Pharmaceutical vs. KT Submarine Telecom | Sinil Pharmaceutical vs. Seoul Electronics Telecom |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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