Correlation Between Solution Advanced and Korea Shipbuilding
Can any of the company-specific risk be diversified away by investing in both Solution Advanced and Korea Shipbuilding 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 Solution Advanced and Korea Shipbuilding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solution Advanced Technology and Korea Shipbuilding Offshore, you can compare the effects of market volatilities on Solution Advanced and Korea Shipbuilding 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 Solution Advanced with a short position of Korea Shipbuilding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solution Advanced and Korea Shipbuilding.
Diversification Opportunities for Solution Advanced and Korea Shipbuilding
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Solution and Korea is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Solution Advanced Technology and Korea Shipbuilding Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Shipbuilding and Solution Advanced 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 Solution Advanced Technology are associated (or correlated) with Korea Shipbuilding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Shipbuilding has no effect on the direction of Solution Advanced i.e., Solution Advanced and Korea Shipbuilding go up and down completely randomly.
Pair Corralation between Solution Advanced and Korea Shipbuilding
Assuming the 90 days trading horizon Solution Advanced Technology is expected to under-perform the Korea Shipbuilding. In addition to that, Solution Advanced is 1.1 times more volatile than Korea Shipbuilding Offshore. It trades about -0.06 of its total potential returns per unit of risk. Korea Shipbuilding Offshore is currently generating about 0.11 per unit of volatility. If you would invest 10,090,000 in Korea Shipbuilding Offshore on September 14, 2024 and sell it today you would earn a total of 10,910,000 from holding Korea Shipbuilding Offshore or generate 108.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.62% |
| Values | Daily Returns |
Solution Advanced Technology vs. Korea Shipbuilding Offshore
Performance |
| Timeline |
| Solution Advanced |
| Korea Shipbuilding |
Solution Advanced and Korea Shipbuilding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solution Advanced and Korea Shipbuilding
The main advantage of trading using opposite Solution Advanced and Korea Shipbuilding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solution Advanced position performs unexpectedly, Korea Shipbuilding 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 Korea Shipbuilding will offset losses from the drop in Korea Shipbuilding's long position.| Solution Advanced vs. Samsung Electronics Co | Solution Advanced vs. Samsung Electronics Co | Solution Advanced vs. LG Energy Solution | Solution Advanced vs. SK Hynix |
| Korea Shipbuilding vs. Korea New Network | Korea Shipbuilding vs. Solution Advanced Technology | Korea Shipbuilding vs. Busan Industrial Co | Korea Shipbuilding vs. Busan Ind |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |