Correlation Between PJ Metal and SAMG Entertainment
Can any of the company-specific risk be diversified away by investing in both PJ Metal and SAMG Entertainment 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 SAMG Entertainment 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 SAMG Entertainment Co, you can compare the effects of market volatilities on PJ Metal and SAMG Entertainment 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 SAMG Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJ Metal and SAMG Entertainment.
Diversification Opportunities for PJ Metal and SAMG Entertainment
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 128660 and SAMG is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding PJ Metal Co and SAMG Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAMG Entertainment 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 SAMG Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAMG Entertainment has no effect on the direction of PJ Metal i.e., PJ Metal and SAMG Entertainment go up and down completely randomly.
Pair Corralation between PJ Metal and SAMG Entertainment
Assuming the 90 days trading horizon PJ Metal Co is expected to generate 0.79 times more return on investment than SAMG Entertainment. However, PJ Metal Co is 1.27 times less risky than SAMG Entertainment. It trades about 0.01 of its potential returns per unit of risk. SAMG Entertainment Co is currently generating about -0.03 per unit of risk. If you would invest 334,963 in PJ Metal Co on November 5, 2024 and sell it today you would lose (36,463) from holding PJ Metal Co or give up 10.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJ Metal Co vs. SAMG Entertainment Co
Performance |
| Timeline |
| PJ Metal |
| SAMG Entertainment |
PJ Metal and SAMG Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJ Metal and SAMG Entertainment
The main advantage of trading using opposite PJ Metal and SAMG Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJ Metal position performs unexpectedly, SAMG Entertainment 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 SAMG Entertainment will offset losses from the drop in SAMG Entertainment's long position.| PJ Metal vs. Lotte Non Life Insurance | PJ Metal vs. Daishin Information Communications | PJ Metal vs. Samlip General Foods | PJ Metal vs. Haitai Confectionery Foods |
| SAMG Entertainment vs. Stic Investments | SAMG Entertainment vs. TS Investment Corp | SAMG Entertainment vs. Shinil Electronics Co | SAMG Entertainment vs. Cuckoo Electronics 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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