Correlation Between SebitChem and Nam Hwa
Can any of the company-specific risk be diversified away by investing in both SebitChem and Nam Hwa 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 SebitChem and Nam Hwa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SebitChem Co and Nam Hwa Construction, you can compare the effects of market volatilities on SebitChem and Nam Hwa 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 SebitChem with a short position of Nam Hwa. Check out your portfolio center. Please also check ongoing floating volatility patterns of SebitChem and Nam Hwa.
Diversification Opportunities for SebitChem and Nam Hwa
Pay attention - limited upside
The 3 months correlation between SebitChem and Nam is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SebitChem Co and Nam Hwa Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nam Hwa Construction and SebitChem 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 SebitChem Co are associated (or correlated) with Nam Hwa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nam Hwa Construction has no effect on the direction of SebitChem i.e., SebitChem and Nam Hwa go up and down completely randomly.
Pair Corralation between SebitChem and Nam Hwa
If you would invest 396,000 in Nam Hwa Construction on September 2, 2024 and sell it today you would earn a total of 14,000 from holding Nam Hwa Construction or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
SebitChem Co vs. Nam Hwa Construction
Performance |
| Timeline |
| SebitChem |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Nam Hwa Construction |
SebitChem and Nam Hwa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SebitChem and Nam Hwa
The main advantage of trading using opposite SebitChem and Nam Hwa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SebitChem position performs unexpectedly, Nam Hwa 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 Nam Hwa will offset losses from the drop in Nam Hwa's long position.| SebitChem vs. Lotte Chilsung Beverage | SebitChem vs. Digital Multimedia Technology | SebitChem vs. Alton Sports CoLtd | SebitChem vs. Barunson Entertainment Arts |
| Nam Hwa vs. Korea New Network | Nam Hwa vs. ICD Co | Nam Hwa vs. DYPNF CoLtd | Nam Hwa vs. Busan Industrial Co |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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