Correlation Between KG Eco and Shinil Electronics
Can any of the company-specific risk be diversified away by investing in both KG Eco and Shinil 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 KG Eco and Shinil Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KG Eco Technology and Shinil Electronics Co, you can compare the effects of market volatilities on KG Eco and Shinil 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 KG Eco with a short position of Shinil Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of KG Eco and Shinil Electronics.
Diversification Opportunities for KG Eco and Shinil Electronics
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 151860 and Shinil is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding KG Eco Technology and Shinil Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinil Electronics and KG Eco 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 KG Eco Technology are associated (or correlated) with Shinil Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinil Electronics has no effect on the direction of KG Eco i.e., KG Eco and Shinil Electronics go up and down completely randomly.
Pair Corralation between KG Eco and Shinil Electronics
Assuming the 90 days trading horizon KG Eco Technology is expected to generate 2.78 times more return on investment than Shinil Electronics. However, KG Eco is 2.78 times more volatile than Shinil Electronics Co. It trades about 0.03 of its potential returns per unit of risk. Shinil Electronics Co is currently generating about 0.04 per unit of risk. If you would invest 532,000 in KG Eco Technology on August 29, 2024 and sell it today you would earn a total of 6,000 from holding KG Eco Technology or generate 1.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KG Eco Technology vs. Shinil Electronics Co
Performance |
| Timeline |
| KG Eco Technology |
| Shinil Electronics |
KG Eco and Shinil Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KG Eco and Shinil Electronics
The main advantage of trading using opposite KG Eco and Shinil Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KG Eco position performs unexpectedly, Shinil 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 Shinil Electronics will offset losses from the drop in Shinil Electronics' long position.| KG Eco vs. Samlip General Foods | KG Eco vs. Seoul Food Industrial | KG Eco vs. Hanjoo Light Metal | KG Eco vs. Dongil Metal Co |
| Shinil Electronics vs. Busan Industrial Co | Shinil Electronics vs. Busan Ind | Shinil Electronics vs. Mirae Asset Daewoo | Shinil Electronics vs. UNISEM 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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