Correlation Between SKONEC Entertainment and Digital Imaging
Can any of the company-specific risk be diversified away by investing in both SKONEC Entertainment and Digital Imaging 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 SKONEC Entertainment and Digital Imaging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SKONEC Entertainment Co and Digital Imaging Technology, you can compare the effects of market volatilities on SKONEC Entertainment and Digital Imaging 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 SKONEC Entertainment with a short position of Digital Imaging. Check out your portfolio center. Please also check ongoing floating volatility patterns of SKONEC Entertainment and Digital Imaging.
Diversification Opportunities for SKONEC Entertainment and Digital Imaging
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SKONEC and Digital is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding SKONEC Entertainment Co and Digital Imaging Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital Imaging Tech and SKONEC Entertainment 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 SKONEC Entertainment Co are associated (or correlated) with Digital Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital Imaging Tech has no effect on the direction of SKONEC Entertainment i.e., SKONEC Entertainment and Digital Imaging go up and down completely randomly.
Pair Corralation between SKONEC Entertainment and Digital Imaging
Assuming the 90 days trading horizon SKONEC Entertainment Co is expected to under-perform the Digital Imaging. But the stock apears to be less risky and, when comparing its historical volatility, SKONEC Entertainment Co is 1.31 times less risky than Digital Imaging. The stock trades about -0.02 of its potential returns per unit of risk. The Digital Imaging Technology is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,593,345 in Digital Imaging Technology on October 16, 2024 and sell it today you would lose (191,345) from holding Digital Imaging Technology or give up 12.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SKONEC Entertainment Co vs. Digital Imaging Technology
Performance |
| Timeline |
| SKONEC Entertainment |
| Digital Imaging Tech |
SKONEC Entertainment and Digital Imaging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SKONEC Entertainment and Digital Imaging
The main advantage of trading using opposite SKONEC Entertainment and Digital Imaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SKONEC Entertainment position performs unexpectedly, Digital Imaging 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 Digital Imaging will offset losses from the drop in Digital Imaging's long position.| SKONEC Entertainment vs. Korean Air Lines | SKONEC Entertainment vs. Haitai Confectionery Foods | SKONEC Entertainment vs. Sempio Foods Co | SKONEC Entertainment vs. BGF Retail Co |
| Digital Imaging vs. NH Investment Securities | Digital Imaging vs. Sempio Foods Co | Digital Imaging vs. Sangsangin Investment Securities | Digital Imaging vs. Woori Technology Investment |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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