Correlation Between Shin Heung and S Fuelcell
Can any of the company-specific risk be diversified away by investing in both Shin Heung and S Fuelcell 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 Heung and S Fuelcell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shin Heung Energy and S Fuelcell co, you can compare the effects of market volatilities on Shin Heung and S Fuelcell 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 Heung with a short position of S Fuelcell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shin Heung and S Fuelcell.
Diversification Opportunities for Shin Heung and S Fuelcell
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shin and 288620 is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Shin Heung Energy and S Fuelcell co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on S Fuelcell co and Shin Heung 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 Heung Energy are associated (or correlated) with S Fuelcell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of S Fuelcell co has no effect on the direction of Shin Heung i.e., Shin Heung and S Fuelcell go up and down completely randomly.
Pair Corralation between Shin Heung and S Fuelcell
Assuming the 90 days trading horizon Shin Heung Energy is expected to generate 0.99 times more return on investment than S Fuelcell. However, Shin Heung Energy is 1.01 times less risky than S Fuelcell. It trades about -0.07 of its potential returns per unit of risk. S Fuelcell co is currently generating about -0.1 per unit of risk. If you would invest 930,000 in Shin Heung Energy on August 25, 2024 and sell it today you would lose (358,000) from holding Shin Heung Energy or give up 38.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.55% |
| Values | Daily Returns |
Shin Heung Energy vs. S Fuelcell co
Performance |
| Timeline |
| Shin Heung Energy |
| S Fuelcell co |
Shin Heung and S Fuelcell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shin Heung and S Fuelcell
The main advantage of trading using opposite Shin Heung and S Fuelcell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shin Heung position performs unexpectedly, S Fuelcell 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 S Fuelcell will offset losses from the drop in S Fuelcell's long position.| Shin Heung vs. Youngchang Chemical Co | Shin Heung vs. Miwon Chemical | Shin Heung vs. Daehan Steel | Shin Heung vs. TK Chemical |
| S Fuelcell vs. Ecopro BM Co | S Fuelcell vs. Shin Heung Energy | S Fuelcell vs. Sangsin Energy Display | S Fuelcell vs. Amogreentech CoLtd |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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