Correlation Between SillaJen and Sewoon Medical
Can any of the company-specific risk be diversified away by investing in both SillaJen and Sewoon Medical 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 SillaJen and Sewoon Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SillaJen and Sewoon Medical Co, you can compare the effects of market volatilities on SillaJen and Sewoon Medical 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 SillaJen with a short position of Sewoon Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SillaJen and Sewoon Medical.
Diversification Opportunities for SillaJen and Sewoon Medical
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between SillaJen and Sewoon is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding SillaJen and Sewoon Medical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sewoon Medical and SillaJen 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 SillaJen are associated (or correlated) with Sewoon Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sewoon Medical has no effect on the direction of SillaJen i.e., SillaJen and Sewoon Medical go up and down completely randomly.
Pair Corralation between SillaJen and Sewoon Medical
Assuming the 90 days trading horizon SillaJen is expected to under-perform the Sewoon Medical. In addition to that, SillaJen is 2.14 times more volatile than Sewoon Medical Co. It trades about -0.03 of its total potential returns per unit of risk. Sewoon Medical Co is currently generating about -0.01 per unit of volatility. If you would invest 281,958 in Sewoon Medical Co on August 31, 2024 and sell it today you would lose (26,458) from holding Sewoon Medical Co or give up 9.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
SillaJen vs. Sewoon Medical Co
Performance |
| Timeline |
| SillaJen |
| Sewoon Medical |
SillaJen and Sewoon Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SillaJen and Sewoon Medical
The main advantage of trading using opposite SillaJen and Sewoon Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SillaJen position performs unexpectedly, Sewoon Medical 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 Sewoon Medical will offset losses from the drop in Sewoon Medical's long position.| SillaJen vs. Korea Investment Holdings | SillaJen vs. TJ media Co | SillaJen vs. E Investment Development | SillaJen vs. Nasmedia Co |
| Sewoon Medical vs. AptaBio Therapeutics | Sewoon Medical vs. KT Hitel | Sewoon Medical vs. SillaJen | Sewoon Medical vs. Cytogen |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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