Correlation Between PJ Metal and Sangshin Electronics
Can any of the company-specific risk be diversified away by investing in both PJ Metal 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 PJ Metal and Sangshin Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PJ Metal Co and Sangshin Electronics Co, you can compare the effects of market volatilities on PJ Metal 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 PJ Metal with a short position of Sangshin Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJ Metal and Sangshin Electronics.
Diversification Opportunities for PJ Metal and Sangshin Electronics
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 128660 and Sangshin is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding PJ Metal Co and Sangshin Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangshin Electronics and PJ Metal 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 PJ Metal Co 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 PJ Metal i.e., PJ Metal and Sangshin Electronics go up and down completely randomly.
Pair Corralation between PJ Metal and Sangshin Electronics
Assuming the 90 days trading horizon PJ Metal Co is expected to under-perform the Sangshin Electronics. In addition to that, PJ Metal is 1.41 times more volatile than Sangshin Electronics Co. It trades about -0.07 of its total potential returns per unit of risk. Sangshin Electronics Co is currently generating about -0.09 per unit of volatility. If you would invest 380,000 in Sangshin Electronics Co on September 3, 2024 and sell it today you would lose (87,000) from holding Sangshin Electronics Co or give up 22.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJ Metal Co vs. Sangshin Electronics Co
Performance |
| Timeline |
| PJ Metal |
| Sangshin Electronics |
PJ Metal and Sangshin Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJ Metal and Sangshin Electronics
The main advantage of trading using opposite PJ Metal and Sangshin Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJ Metal 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.| PJ Metal vs. Keum Kang Steel | PJ Metal vs. Tplex Co | PJ Metal vs. Gyeongnam Steel Co | PJ Metal vs. Jeil Steel Mfg |
| Sangshin Electronics vs. Daejoo Electronic Materials | Sangshin Electronics vs. Parksystems Corp | Sangshin Electronics vs. BH Co | Sangshin Electronics vs. Partron 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Transaction History View history of all your transactions and understand their impact on performance |