Correlation Between Woori Financial and Sangsangin Investment
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Sangsangin Investment 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 Financial and Sangsangin Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and Sangsangin Investment Securities, you can compare the effects of market volatilities on Woori Financial and Sangsangin Investment 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 Financial with a short position of Sangsangin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Sangsangin Investment.
Diversification Opportunities for Woori Financial and Sangsangin Investment
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Woori and Sangsangin is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Sangsangin Investment Securiti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangsangin Investment and Woori Financial 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 Financial Group are associated (or correlated) with Sangsangin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sangsangin Investment has no effect on the direction of Woori Financial i.e., Woori Financial and Sangsangin Investment go up and down completely randomly.
Pair Corralation between Woori Financial and Sangsangin Investment
Assuming the 90 days trading horizon Woori Financial Group is expected to generate 0.83 times more return on investment than Sangsangin Investment. However, Woori Financial Group is 1.2 times less risky than Sangsangin Investment. It trades about 0.06 of its potential returns per unit of risk. Sangsangin Investment Securities is currently generating about -0.06 per unit of risk. If you would invest 1,068,866 in Woori Financial Group on September 12, 2024 and sell it today you would earn a total of 475,134 from holding Woori Financial Group or generate 44.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Sangsangin Investment Securiti
Performance |
| Timeline |
| Woori Financial Group |
| Sangsangin Investment |
Woori Financial and Sangsangin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Sangsangin Investment
The main advantage of trading using opposite Woori Financial and Sangsangin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Sangsangin Investment 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 Sangsangin Investment will offset losses from the drop in Sangsangin Investment's long position.| Woori Financial vs. DB Insurance Co | Woori Financial vs. Pureun Mutual Savings | Woori Financial vs. Shinhan Financial Group | Woori Financial vs. iNtRON Biotechnology |
| Sangsangin Investment vs. KB Financial Group | Sangsangin Investment vs. Shinhan Financial Group | Sangsangin Investment vs. Hana Financial | Sangsangin Investment vs. Woori Financial Group |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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