Correlation Between Youngchang Chemical and Samick Musical
Can any of the company-specific risk be diversified away by investing in both Youngchang Chemical and Samick Musical 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 Youngchang Chemical and Samick Musical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngchang Chemical Co and Samick Musical Instruments, you can compare the effects of market volatilities on Youngchang Chemical and Samick Musical 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 Youngchang Chemical with a short position of Samick Musical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngchang Chemical and Samick Musical.
Diversification Opportunities for Youngchang Chemical and Samick Musical
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Youngchang and Samick is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Youngchang Chemical Co and Samick Musical Instruments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samick Musical Instr and Youngchang Chemical 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 Youngchang Chemical Co are associated (or correlated) with Samick Musical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samick Musical Instr has no effect on the direction of Youngchang Chemical i.e., Youngchang Chemical and Samick Musical go up and down completely randomly.
Pair Corralation between Youngchang Chemical and Samick Musical
Assuming the 90 days trading horizon Youngchang Chemical Co is expected to under-perform the Samick Musical. In addition to that, Youngchang Chemical is 6.42 times more volatile than Samick Musical Instruments. It trades about -0.3 of its total potential returns per unit of risk. Samick Musical Instruments is currently generating about 0.26 per unit of volatility. If you would invest 107,800 in Samick Musical Instruments on September 4, 2024 and sell it today you would earn a total of 3,000 from holding Samick Musical Instruments or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngchang Chemical Co vs. Samick Musical Instruments
Performance |
| Timeline |
| Youngchang Chemical |
| Samick Musical Instr |
Youngchang Chemical and Samick Musical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngchang Chemical and Samick Musical
The main advantage of trading using opposite Youngchang Chemical and Samick Musical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngchang Chemical position performs unexpectedly, Samick Musical 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 Samick Musical will offset losses from the drop in Samick Musical's long position.| Youngchang Chemical vs. LG Chem | Youngchang Chemical vs. DukSan Neolux CoLtd | Youngchang Chemical vs. LIG ES SPAC | Youngchang Chemical vs. Sukgyung AT Co |
| Samick Musical vs. Pureun Mutual Savings | Samick Musical vs. Korea Shipbuilding Offshore | Samick Musical vs. Kukdong Oil Chemicals | Samick Musical vs. Sung Bo Chemicals |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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