Correlation Between SIMMTECH and Haesung DS
Can any of the company-specific risk be diversified away by investing in both SIMMTECH and Haesung DS 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 SIMMTECH and Haesung DS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIMMTECH Co and Haesung DS Co, you can compare the effects of market volatilities on SIMMTECH and Haesung DS 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 SIMMTECH with a short position of Haesung DS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIMMTECH and Haesung DS.
Diversification Opportunities for SIMMTECH and Haesung DS
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SIMMTECH and Haesung is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding SIMMTECH Co and Haesung DS Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haesung DS and SIMMTECH 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 SIMMTECH Co are associated (or correlated) with Haesung DS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haesung DS has no effect on the direction of SIMMTECH i.e., SIMMTECH and Haesung DS go up and down completely randomly.
Pair Corralation between SIMMTECH and Haesung DS
Assuming the 90 days trading horizon SIMMTECH Co is expected to under-perform the Haesung DS. In addition to that, SIMMTECH is 1.05 times more volatile than Haesung DS Co. It trades about -0.25 of its total potential returns per unit of risk. Haesung DS Co is currently generating about -0.18 per unit of volatility. If you would invest 4,875,000 in Haesung DS Co on August 25, 2024 and sell it today you would lose (2,535,000) from holding Haesung DS Co or give up 52.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.19% |
| Values | Daily Returns |
SIMMTECH Co vs. Haesung DS Co
Performance |
| Timeline |
| SIMMTECH |
| Haesung DS |
SIMMTECH and Haesung DS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIMMTECH and Haesung DS
The main advantage of trading using opposite SIMMTECH and Haesung DS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIMMTECH position performs unexpectedly, Haesung DS 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 Haesung DS will offset losses from the drop in Haesung DS's long position.| SIMMTECH vs. People Technology | SIMMTECH vs. iNtRON Biotechnology | SIMMTECH vs. Hanjin Transportation Co | SIMMTECH vs. Alton Sports CoLtd |
| Haesung DS vs. Korea Real Estate | Haesung DS vs. Korea Ratings Co | Haesung DS vs. IQuest Co | Haesung DS vs. Wonbang Tech 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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