Correlation Between Seojin Automotive and Samjin LND
Can any of the company-specific risk be diversified away by investing in both Seojin Automotive and Samjin LND 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 Seojin Automotive and Samjin LND into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seojin Automotive CoLtd and Samjin LND Co, you can compare the effects of market volatilities on Seojin Automotive and Samjin LND 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 Seojin Automotive with a short position of Samjin LND. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seojin Automotive and Samjin LND.
Diversification Opportunities for Seojin Automotive and Samjin LND
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Seojin and Samjin is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Seojin Automotive CoLtd and Samjin LND Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samjin LND and Seojin Automotive 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 Seojin Automotive CoLtd are associated (or correlated) with Samjin LND. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samjin LND has no effect on the direction of Seojin Automotive i.e., Seojin Automotive and Samjin LND go up and down completely randomly.
Pair Corralation between Seojin Automotive and Samjin LND
Assuming the 90 days trading horizon Seojin Automotive CoLtd is expected to generate about the same return on investment as Samjin LND Co. But, Seojin Automotive CoLtd is 1.2 times less risky than Samjin LND. It trades about -0.16 of its potential returns per unit of risk. Samjin LND Co is currently generating about -0.14 per unit of risk. If you would invest 132,700 in Samjin LND Co on September 1, 2024 and sell it today you would lose (54,500) from holding Samjin LND Co or give up 41.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.19% |
| Values | Daily Returns |
Seojin Automotive CoLtd vs. Samjin LND Co
Performance |
| Timeline |
| Seojin Automotive CoLtd |
| Samjin LND |
Seojin Automotive and Samjin LND Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seojin Automotive and Samjin LND
The main advantage of trading using opposite Seojin Automotive and Samjin LND positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seojin Automotive position performs unexpectedly, Samjin LND 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 Samjin LND will offset losses from the drop in Samjin LND's long position.| Seojin Automotive vs. Polaris Office Corp | Seojin Automotive vs. TOPMATERIAL LTD | Seojin Automotive vs. PI Advanced Materials | Seojin Automotive vs. Tway Air Co |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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