Correlation Between Poongsan and UNISEM
Can any of the company-specific risk be diversified away by investing in both Poongsan and UNISEM 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 Poongsan and UNISEM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Poongsan and UNISEM Co, you can compare the effects of market volatilities on Poongsan and UNISEM 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 Poongsan with a short position of UNISEM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Poongsan and UNISEM.
Diversification Opportunities for Poongsan and UNISEM
Poor diversification
The 3 months correlation between Poongsan and UNISEM is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Poongsan and UNISEM Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNISEM and Poongsan 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 Poongsan are associated (or correlated) with UNISEM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNISEM has no effect on the direction of Poongsan i.e., Poongsan and UNISEM go up and down completely randomly.
Pair Corralation between Poongsan and UNISEM
Assuming the 90 days trading horizon Poongsan is expected to generate 0.76 times more return on investment than UNISEM. However, Poongsan is 1.32 times less risky than UNISEM. It trades about 0.05 of its potential returns per unit of risk. UNISEM Co is currently generating about 0.02 per unit of risk. If you would invest 3,545,000 in Poongsan on October 14, 2024 and sell it today you would earn a total of 1,805,000 from holding Poongsan or generate 50.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Poongsan vs. UNISEM Co
Performance |
| Timeline |
| Poongsan |
| UNISEM |
Poongsan and UNISEM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Poongsan and UNISEM
The main advantage of trading using opposite Poongsan and UNISEM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Poongsan position performs unexpectedly, UNISEM 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 UNISEM will offset losses from the drop in UNISEM's long position.| Poongsan vs. Cuckoo Homesys Co | Poongsan vs. Foodnamoo | Poongsan vs. FOODWELL Co | Poongsan vs. Sam Yang Foods |
| UNISEM vs. Woorim Machinery Co | UNISEM vs. Hanmi Semiconductor Co | UNISEM vs. KEPCO Engineering Construction | UNISEM vs. Semyung Electric Machinery |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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