Correlation Between NAU IB and Shin Steel
Can any of the company-specific risk be diversified away by investing in both NAU IB and Shin Steel 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 NAU IB and Shin Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NAU IB Capital and Shin Steel Co, you can compare the effects of market volatilities on NAU IB and Shin Steel 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 NAU IB with a short position of Shin Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of NAU IB and Shin Steel.
Diversification Opportunities for NAU IB and Shin Steel
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NAU and Shin is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding NAU IB Capital and Shin Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Steel and NAU IB 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 NAU IB Capital are associated (or correlated) with Shin Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Steel has no effect on the direction of NAU IB i.e., NAU IB and Shin Steel go up and down completely randomly.
Pair Corralation between NAU IB and Shin Steel
Assuming the 90 days trading horizon NAU IB Capital is expected to generate 3.91 times more return on investment than Shin Steel. However, NAU IB is 3.91 times more volatile than Shin Steel Co. It trades about 0.24 of its potential returns per unit of risk. Shin Steel Co is currently generating about 0.48 per unit of risk. If you would invest 89,007 in NAU IB Capital on October 9, 2024 and sell it today you would earn a total of 40,593 from holding NAU IB Capital or generate 45.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NAU IB Capital vs. Shin Steel Co
Performance |
| Timeline |
| NAU IB Capital |
| Shin Steel |
NAU IB and Shin Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NAU IB and Shin Steel
The main advantage of trading using opposite NAU IB and Shin Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NAU IB position performs unexpectedly, Shin Steel 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 Shin Steel will offset losses from the drop in Shin Steel's long position.| NAU IB vs. ECSTELECOM Co | NAU IB vs. Digital Power Communications | NAU IB vs. Ssangyong Information Communication | NAU IB vs. INNOX Advanced Materials |
| Shin Steel vs. Samsung Electronics Co | Shin Steel vs. Samsung Electronics Co | Shin Steel vs. LG Energy Solution | Shin Steel 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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