Correlation Between Woori Financial and Sam Yang
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Sam Yang 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 Sam Yang 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 Sam Yang Foods, you can compare the effects of market volatilities on Woori Financial and Sam Yang 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 Sam Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Sam Yang.
Diversification Opportunities for Woori Financial and Sam Yang
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and Sam is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Sam Yang Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sam Yang Foods 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 Sam Yang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sam Yang Foods has no effect on the direction of Woori Financial i.e., Woori Financial and Sam Yang go up and down completely randomly.
Pair Corralation between Woori Financial and Sam Yang
Assuming the 90 days trading horizon Woori Financial is expected to generate 4.03 times less return on investment than Sam Yang. But when comparing it to its historical volatility, Woori Financial Group is 2.19 times less risky than Sam Yang. It trades about 0.08 of its potential returns per unit of risk. Sam Yang Foods is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 19,840,100 in Sam Yang Foods on September 26, 2024 and sell it today you would earn a total of 58,459,900 from holding Sam Yang Foods or generate 294.66% 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. Sam Yang Foods
Performance |
| Timeline |
| Woori Financial Group |
| Sam Yang Foods |
Woori Financial and Sam Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Sam Yang
The main advantage of trading using opposite Woori Financial and Sam Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Sam Yang 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 Sam Yang will offset losses from the drop in Sam Yang's long position.| Woori Financial vs. Miwon Chemical | Woori Financial vs. Sangsangin Investment Securities | Woori Financial vs. SK Chemicals Co | Woori Financial vs. Youl Chon Chemical |
| Sam Yang vs. Woori Financial Group | Sam Yang vs. Jb Financial | Sam Yang vs. Nh Investment And | Sam Yang vs. Kumho Petro Chemical |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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