Correlation Between Robotis CoLtd and Sangshin Electronics
Can any of the company-specific risk be diversified away by investing in both Robotis CoLtd and Sangshin Electronics 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 Robotis CoLtd and Sangshin Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Robotis CoLtd and Sangshin Electronics Co, you can compare the effects of market volatilities on Robotis CoLtd and Sangshin Electronics 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 Robotis CoLtd with a short position of Sangshin Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Robotis CoLtd and Sangshin Electronics.
Diversification Opportunities for Robotis CoLtd and Sangshin Electronics
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Robotis and Sangshin is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Robotis CoLtd and Sangshin Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangshin Electronics and Robotis CoLtd 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 Robotis CoLtd are associated (or correlated) with Sangshin Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sangshin Electronics has no effect on the direction of Robotis CoLtd i.e., Robotis CoLtd and Sangshin Electronics go up and down completely randomly.
Pair Corralation between Robotis CoLtd and Sangshin Electronics
Assuming the 90 days trading horizon Robotis CoLtd is expected to generate 1.15 times less return on investment than Sangshin Electronics. But when comparing it to its historical volatility, Robotis CoLtd is 1.06 times less risky than Sangshin Electronics. It trades about 0.0 of its potential returns per unit of risk. Sangshin Electronics Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 340,500 in Sangshin Electronics Co on September 12, 2024 and sell it today you would lose (76,000) from holding Sangshin Electronics Co or give up 22.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Robotis CoLtd vs. Sangshin Electronics Co
Performance |
| Timeline |
| Robotis CoLtd |
| Sangshin Electronics |
Robotis CoLtd and Sangshin Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Robotis CoLtd and Sangshin Electronics
The main advantage of trading using opposite Robotis CoLtd and Sangshin Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Robotis CoLtd position performs unexpectedly, Sangshin Electronics 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 Sangshin Electronics will offset losses from the drop in Sangshin Electronics' long position.| Robotis CoLtd vs. FOODWELL Co | Robotis CoLtd vs. Dongil Metal Co | Robotis CoLtd vs. CJ Seafood Corp | Robotis CoLtd vs. Hanjoo Light Metal |
| Sangshin Electronics vs. Daejoo Electronic Materials | Sangshin Electronics vs. Interflex Co | Sangshin Electronics vs. Solution Advanced Technology | Sangshin Electronics 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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