Correlation Between LG Energy and Shinil Industrial
Can any of the company-specific risk be diversified away by investing in both LG Energy and Shinil Industrial 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 LG Energy and Shinil Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LG Energy Solution and Shinil Industrial Co, you can compare the effects of market volatilities on LG Energy and Shinil Industrial 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 LG Energy with a short position of Shinil Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG Energy and Shinil Industrial.
Diversification Opportunities for LG Energy and Shinil Industrial
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 373220 and Shinil is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding LG Energy Solution and Shinil Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinil Industrial and LG Energy 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 LG Energy Solution are associated (or correlated) with Shinil Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinil Industrial has no effect on the direction of LG Energy i.e., LG Energy and Shinil Industrial go up and down completely randomly.
Pair Corralation between LG Energy and Shinil Industrial
Assuming the 90 days trading horizon LG Energy Solution is expected to under-perform the Shinil Industrial. In addition to that, LG Energy is 2.28 times more volatile than Shinil Industrial Co. It trades about -0.14 of its total potential returns per unit of risk. Shinil Industrial Co is currently generating about 0.08 per unit of volatility. If you would invest 140,324 in Shinil Industrial Co on October 12, 2024 and sell it today you would earn a total of 2,376 from holding Shinil Industrial Co or generate 1.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LG Energy Solution vs. Shinil Industrial Co
Performance |
| Timeline |
| LG Energy Solution |
| Shinil Industrial |
LG Energy and Shinil Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LG Energy and Shinil Industrial
The main advantage of trading using opposite LG Energy and Shinil Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG Energy position performs unexpectedly, Shinil Industrial 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 Shinil Industrial will offset losses from the drop in Shinil Industrial's long position.| LG Energy vs. Polaris Office Corp | LG Energy vs. Kukdong Oil Chemicals | LG Energy vs. Clean Science co | LG Energy vs. Namhae Chemical |
| Shinil Industrial vs. Samsung Electronics Co | Shinil Industrial vs. Samsung Electronics Co | Shinil Industrial vs. LG Energy Solution | Shinil Industrial vs. SK Hynix |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |