Correlation Between Innometry and Sungdo Engineering
Can any of the company-specific risk be diversified away by investing in both Innometry and Sungdo Engineering 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 Innometry and Sungdo Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innometry Co and Sungdo Engineering Construction, you can compare the effects of market volatilities on Innometry and Sungdo Engineering 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 Innometry with a short position of Sungdo Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innometry and Sungdo Engineering.
Diversification Opportunities for Innometry and Sungdo Engineering
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Innometry and Sungdo is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Innometry Co and Sungdo Engineering Constructio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sungdo Engineering and Innometry 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 Innometry Co are associated (or correlated) with Sungdo Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sungdo Engineering has no effect on the direction of Innometry i.e., Innometry and Sungdo Engineering go up and down completely randomly.
Pair Corralation between Innometry and Sungdo Engineering
Assuming the 90 days trading horizon Innometry Co is expected to under-perform the Sungdo Engineering. In addition to that, Innometry is 1.19 times more volatile than Sungdo Engineering Construction. It trades about -0.04 of its total potential returns per unit of risk. Sungdo Engineering Construction is currently generating about 0.02 per unit of volatility. If you would invest 402,377 in Sungdo Engineering Construction on September 4, 2024 and sell it today you would earn a total of 29,623 from holding Sungdo Engineering Construction or generate 7.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innometry Co vs. Sungdo Engineering Constructio
Performance |
| Timeline |
| Innometry |
| Sungdo Engineering |
Innometry and Sungdo Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innometry and Sungdo Engineering
The main advantage of trading using opposite Innometry and Sungdo Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innometry position performs unexpectedly, Sungdo Engineering 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 Sungdo Engineering will offset losses from the drop in Sungdo Engineering's long position.| Innometry vs. Daejoo Electronic Materials | Innometry vs. Parksystems Corp | Innometry vs. BH Co | Innometry vs. Partron Co |
| Sungdo Engineering vs. LG Display | Sungdo Engineering vs. Hyundai Motor | Sungdo Engineering vs. Hyundai Motor Co | Sungdo Engineering vs. Hyundai Motor Co |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |