Correlation Between Ajusteel and Samyung Trading
Can any of the company-specific risk be diversified away by investing in both Ajusteel and Samyung Trading 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 Ajusteel and Samyung Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ajusteel Co and Samyung Trading Co, you can compare the effects of market volatilities on Ajusteel and Samyung Trading 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 Ajusteel with a short position of Samyung Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ajusteel and Samyung Trading.
Diversification Opportunities for Ajusteel and Samyung Trading
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ajusteel and Samyung is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Ajusteel Co and Samyung Trading Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyung Trading and Ajusteel 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 Ajusteel Co are associated (or correlated) with Samyung Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyung Trading has no effect on the direction of Ajusteel i.e., Ajusteel and Samyung Trading go up and down completely randomly.
Pair Corralation between Ajusteel and Samyung Trading
Assuming the 90 days trading horizon Ajusteel Co is expected to under-perform the Samyung Trading. In addition to that, Ajusteel is 4.87 times more volatile than Samyung Trading Co. It trades about -0.38 of its total potential returns per unit of risk. Samyung Trading Co is currently generating about 0.22 per unit of volatility. If you would invest 1,274,000 in Samyung Trading Co on September 1, 2024 and sell it today you would earn a total of 26,000 from holding Samyung Trading Co or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ajusteel Co vs. Samyung Trading Co
Performance |
| Timeline |
| Ajusteel |
| Samyung Trading |
Ajusteel and Samyung Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ajusteel and Samyung Trading
The main advantage of trading using opposite Ajusteel and Samyung Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ajusteel position performs unexpectedly, Samyung Trading 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 Samyung Trading will offset losses from the drop in Samyung Trading's long position.| Ajusteel vs. Korea Information Communications | Ajusteel vs. Sungdo Engineering Construction | Ajusteel vs. Dongwoo Farm To | Ajusteel vs. Shinsegae Information Communication |
| Samyung Trading vs. Dongwon Metal Co | Samyung Trading vs. Shinhan Inverse Copper | Samyung Trading vs. Alton Sports CoLtd | Samyung Trading vs. Daejung Chemicals Metals |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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