Correlation Between Daewoo SBI and Shinhan Financial
Can any of the company-specific risk be diversified away by investing in both Daewoo SBI and Shinhan Financial 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 Daewoo SBI and Shinhan Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daewoo SBI SPAC and Shinhan Financial Group, you can compare the effects of market volatilities on Daewoo SBI and Shinhan Financial 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 Daewoo SBI with a short position of Shinhan Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewoo SBI and Shinhan Financial.
Diversification Opportunities for Daewoo SBI and Shinhan Financial
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Daewoo and Shinhan is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Daewoo SBI SPAC and Shinhan Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Financial and Daewoo SBI 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 Daewoo SBI SPAC are associated (or correlated) with Shinhan Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Financial has no effect on the direction of Daewoo SBI i.e., Daewoo SBI and Shinhan Financial go up and down completely randomly.
Pair Corralation between Daewoo SBI and Shinhan Financial
Assuming the 90 days trading horizon Daewoo SBI SPAC is expected to under-perform the Shinhan Financial. But the stock apears to be less risky and, when comparing its historical volatility, Daewoo SBI SPAC is 1.4 times less risky than Shinhan Financial. The stock trades about -0.16 of its potential returns per unit of risk. The Shinhan Financial Group is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,618,631 in Shinhan Financial Group on August 29, 2024 and sell it today you would earn a total of 891,369 from holding Shinhan Financial Group or generate 19.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewoo SBI SPAC vs. Shinhan Financial Group
Performance |
| Timeline |
| Daewoo SBI SPAC |
| Shinhan Financial |
Daewoo SBI and Shinhan Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewoo SBI and Shinhan Financial
The main advantage of trading using opposite Daewoo SBI and Shinhan Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewoo SBI position performs unexpectedly, Shinhan Financial 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 Shinhan Financial will offset losses from the drop in Shinhan Financial's long position.| Daewoo SBI vs. CU Medical Systems | Daewoo SBI vs. Sejong Telecom | Daewoo SBI vs. Digital Power Communications | Daewoo SBI vs. Lotte Non Life Insurance |
| Shinhan Financial vs. AptaBio Therapeutics | Shinhan Financial vs. Daewoo SBI SPAC | Shinhan Financial vs. Dream Security co | Shinhan Financial 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |