Correlation Between Youngchang Chemical and Ssangyong Information
Can any of the company-specific risk be diversified away by investing in both Youngchang Chemical and Ssangyong Information 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 Ssangyong Information 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 Ssangyong Information Communication, you can compare the effects of market volatilities on Youngchang Chemical and Ssangyong Information 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 Ssangyong Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngchang Chemical and Ssangyong Information.
Diversification Opportunities for Youngchang Chemical and Ssangyong Information
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Youngchang and Ssangyong is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Youngchang Chemical Co and Ssangyong Information Communic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ssangyong Information 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 Ssangyong Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ssangyong Information has no effect on the direction of Youngchang Chemical i.e., Youngchang Chemical and Ssangyong Information go up and down completely randomly.
Pair Corralation between Youngchang Chemical and Ssangyong Information
Assuming the 90 days trading horizon Youngchang Chemical Co is expected to under-perform the Ssangyong Information. In addition to that, Youngchang Chemical is 2.31 times more volatile than Ssangyong Information Communication. It trades about -0.3 of its total potential returns per unit of risk. Ssangyong Information Communication is currently generating about 0.23 per unit of volatility. If you would invest 60,300 in Ssangyong Information Communication on September 4, 2024 and sell it today you would earn a total of 4,100 from holding Ssangyong Information Communication or generate 6.8% 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. Ssangyong Information Communic
Performance |
| Timeline |
| Youngchang Chemical |
| Ssangyong Information |
Youngchang Chemical and Ssangyong Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngchang Chemical and Ssangyong Information
The main advantage of trading using opposite Youngchang Chemical and Ssangyong Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngchang Chemical position performs unexpectedly, Ssangyong Information 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 Ssangyong Information will offset losses from the drop in Ssangyong Information'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 |
| Ssangyong Information vs. InfoBank | Ssangyong Information vs. Sam Yang Foods | Ssangyong Information vs. Jeju Bank | Ssangyong Information vs. Hana Financial |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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