Correlation Between Sukgyung and LIG ES
Can any of the company-specific risk be diversified away by investing in both Sukgyung and LIG ES 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 Sukgyung and LIG ES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sukgyung AT Co and LIG ES SPAC, you can compare the effects of market volatilities on Sukgyung and LIG ES 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 Sukgyung with a short position of LIG ES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sukgyung and LIG ES.
Diversification Opportunities for Sukgyung and LIG ES
Very poor diversification
The 3 months correlation between Sukgyung and LIG is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sukgyung AT Co and LIG ES SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LIG ES SPAC and Sukgyung 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 Sukgyung AT Co are associated (or correlated) with LIG ES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LIG ES SPAC has no effect on the direction of Sukgyung i.e., Sukgyung and LIG ES go up and down completely randomly.
Pair Corralation between Sukgyung and LIG ES
Assuming the 90 days trading horizon Sukgyung AT Co is expected to generate 0.59 times more return on investment than LIG ES. However, Sukgyung AT Co is 1.7 times less risky than LIG ES. It trades about -0.38 of its potential returns per unit of risk. LIG ES SPAC is currently generating about -0.38 per unit of risk. If you would invest 4,590,000 in Sukgyung AT Co on August 24, 2024 and sell it today you would lose (670,000) from holding Sukgyung AT Co or give up 14.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sukgyung AT Co vs. LIG ES SPAC
Performance |
| Timeline |
| Sukgyung AT |
| LIG ES SPAC |
Sukgyung and LIG ES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sukgyung and LIG ES
The main advantage of trading using opposite Sukgyung and LIG ES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sukgyung position performs unexpectedly, LIG ES 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 LIG ES will offset losses from the drop in LIG ES's long position.| Sukgyung vs. LG Chem | Sukgyung vs. Chunbo Co | Sukgyung vs. DukSan Neolux CoLtd | Sukgyung vs. Hyosung Chemical Corp |
| LIG ES vs. Ni Steel | LIG ES vs. SBI Investment KOREA | LIG ES vs. DB Financial Investment | LIG ES vs. Lindeman Asia Investment |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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