Correlation Between InnoTherapy and Samyoung Electronics
Can any of the company-specific risk be diversified away by investing in both InnoTherapy and Samyoung Electronics 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 InnoTherapy and Samyoung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InnoTherapy and Samyoung Electronics Co, you can compare the effects of market volatilities on InnoTherapy and Samyoung Electronics 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 InnoTherapy with a short position of Samyoung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of InnoTherapy and Samyoung Electronics.
Diversification Opportunities for InnoTherapy and Samyoung Electronics
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between InnoTherapy and Samyoung is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding InnoTherapy and Samyoung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyoung Electronics and InnoTherapy 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 InnoTherapy are associated (or correlated) with Samyoung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyoung Electronics has no effect on the direction of InnoTherapy i.e., InnoTherapy and Samyoung Electronics go up and down completely randomly.
Pair Corralation between InnoTherapy and Samyoung Electronics
Assuming the 90 days trading horizon InnoTherapy is expected to generate 1.57 times more return on investment than Samyoung Electronics. However, InnoTherapy is 1.57 times more volatile than Samyoung Electronics Co. It trades about 0.02 of its potential returns per unit of risk. Samyoung Electronics Co is currently generating about 0.03 per unit of risk. If you would invest 844,000 in InnoTherapy on November 19, 2024 and sell it today you would earn a total of 110,000 from holding InnoTherapy or generate 13.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
InnoTherapy vs. Samyoung Electronics Co
Performance |
| Timeline |
| InnoTherapy |
| Samyoung Electronics |
InnoTherapy and Samyoung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InnoTherapy and Samyoung Electronics
The main advantage of trading using opposite InnoTherapy and Samyoung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InnoTherapy position performs unexpectedly, Samyoung Electronics 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 Samyoung Electronics will offset losses from the drop in Samyoung Electronics' long position.| InnoTherapy vs. Samsung Publishing Co | InnoTherapy vs. Nable Communications | InnoTherapy vs. INFINITT Healthcare Co | InnoTherapy vs. Innowireless Co |
| Samyoung Electronics vs. Samsung Electronics Co | Samyoung Electronics vs. Samsung Electronics Co | Samyoung Electronics vs. Naver | Samyoung Electronics vs. SK Hynix |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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