Correlation Between WOORI FIN and Select Medical
Can any of the company-specific risk be diversified away by investing in both WOORI FIN and Select Medical 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 WOORI FIN and Select Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WOORI FIN GRP and Select Medical Holdings, you can compare the effects of market volatilities on WOORI FIN and Select Medical 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 WOORI FIN with a short position of Select Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of WOORI FIN and Select Medical.
Diversification Opportunities for WOORI FIN and Select Medical
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between WOORI and Select is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding WOORI FIN GRP and Select Medical Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Select Medical Holdings and WOORI FIN 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 WOORI FIN GRP are associated (or correlated) with Select Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Select Medical Holdings has no effect on the direction of WOORI FIN i.e., WOORI FIN and Select Medical go up and down completely randomly.
Pair Corralation between WOORI FIN and Select Medical
Assuming the 90 days trading horizon WOORI FIN GRP is expected to generate 0.89 times more return on investment than Select Medical. However, WOORI FIN GRP is 1.12 times less risky than Select Medical. It trades about 0.03 of its potential returns per unit of risk. Select Medical Holdings is currently generating about -0.04 per unit of risk. If you would invest 3,220 in WOORI FIN GRP on November 29, 2024 and sell it today you would earn a total of 60.00 from holding WOORI FIN GRP or generate 1.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.33% |
| Values | Daily Returns |
WOORI FIN GRP vs. Select Medical Holdings
Performance |
| Timeline |
| WOORI FIN GRP |
| Select Medical Holdings |
WOORI FIN and Select Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WOORI FIN and Select Medical
The main advantage of trading using opposite WOORI FIN and Select Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WOORI FIN position performs unexpectedly, Select Medical 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 Select Medical will offset losses from the drop in Select Medical's long position.| WOORI FIN vs. Alfa Financial Software | WOORI FIN vs. Cognizant Technology Solutions | WOORI FIN vs. ZURICH INSURANCE GROUP | WOORI FIN vs. The Hanover Insurance |
| Select Medical vs. HCA Healthcare | Select Medical vs. Fresenius SE Co | Select Medical vs. Fresenius Medical Care | Select Medical vs. Fresenius Medical Care |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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