Correlation Between PI Advanced and Samyang Foods
Can any of the company-specific risk be diversified away by investing in both PI Advanced and Samyang Foods 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 PI Advanced and Samyang Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PI Advanced Materials and Samyang Foods Co, you can compare the effects of market volatilities on PI Advanced and Samyang Foods 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 PI Advanced with a short position of Samyang Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of PI Advanced and Samyang Foods.
Diversification Opportunities for PI Advanced and Samyang Foods
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 178920 and Samyang is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PI Advanced Materials and Samyang Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyang Foods and PI Advanced 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 PI Advanced Materials are associated (or correlated) with Samyang Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyang Foods has no effect on the direction of PI Advanced i.e., PI Advanced and Samyang Foods go up and down completely randomly.
Pair Corralation between PI Advanced and Samyang Foods
Assuming the 90 days trading horizon PI Advanced Materials is expected to under-perform the Samyang Foods. In addition to that, PI Advanced is 1.08 times more volatile than Samyang Foods Co. It trades about -0.21 of its total potential returns per unit of risk. Samyang Foods Co is currently generating about 0.05 per unit of volatility. If you would invest 48,900,000 in Samyang Foods Co on September 2, 2024 and sell it today you would earn a total of 3,000,000 from holding Samyang Foods Co or generate 6.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PI Advanced Materials vs. Samyang Foods Co
Performance |
| Timeline |
| PI Advanced Materials |
| Samyang Foods |
PI Advanced and Samyang Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PI Advanced and Samyang Foods
The main advantage of trading using opposite PI Advanced and Samyang Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PI Advanced position performs unexpectedly, Samyang Foods 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 Samyang Foods will offset losses from the drop in Samyang Foods' long position.| PI Advanced vs. Samsung Electronics Co | PI Advanced vs. Samsung Electronics Co | PI Advanced vs. LG Energy Solution | PI Advanced vs. SK Hynix |
| Samyang Foods vs. AptaBio Therapeutics | Samyang Foods vs. Daewoo SBI SPAC | Samyang Foods vs. Dream Security co | Samyang Foods vs. Microfriend |
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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