Correlation Between Shin Steel and Daishin Information
Can any of the company-specific risk be diversified away by investing in both Shin Steel and Daishin Information 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 Shin Steel and Daishin Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Steel Co and Daishin Information Communications, you can compare the effects of market volatilities on Shin Steel and Daishin Information 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 Shin Steel with a short position of Daishin Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Steel and Daishin Information.
Diversification Opportunities for Shin Steel and Daishin Information
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shin and Daishin is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Shin Steel Co and Daishin Information Communicat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daishin Information and Shin Steel 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 Shin Steel Co are associated (or correlated) with Daishin Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daishin Information has no effect on the direction of Shin Steel i.e., Shin Steel and Daishin Information go up and down completely randomly.
Pair Corralation between Shin Steel and Daishin Information
Assuming the 90 days trading horizon Shin Steel Co is expected to under-perform the Daishin Information. But the stock apears to be less risky and, when comparing its historical volatility, Shin Steel Co is 1.48 times less risky than Daishin Information. The stock trades about -0.21 of its potential returns per unit of risk. The Daishin Information Communications is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 98,400 in Daishin Information Communications on October 30, 2024 and sell it today you would earn a total of 5,800 from holding Daishin Information Communications or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shin Steel Co vs. Daishin Information Communicat
Performance |
| Timeline |
| Shin Steel |
| Daishin Information |
Shin Steel and Daishin Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Steel and Daishin Information
The main advantage of trading using opposite Shin Steel and Daishin Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Steel position performs unexpectedly, Daishin Information 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 Daishin Information will offset losses from the drop in Daishin Information's long position.| Shin Steel vs. Samsung Electronics Co | Shin Steel vs. Samsung Electronics Co | Shin Steel vs. LG Energy Solution | Shin Steel vs. SK Hynix |
| Daishin Information vs. Vina Technology Co | Daishin Information vs. HB Technology TD | Daishin Information vs. Hotel Shilla Co | Daishin Information vs. Nable Communications |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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