Correlation Between WooDeumGee Farm and Semyung Electric
Can any of the company-specific risk be diversified away by investing in both WooDeumGee Farm and Semyung Electric 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 WooDeumGee Farm and Semyung Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WooDeumGee Farm Co, and Semyung Electric Machinery, you can compare the effects of market volatilities on WooDeumGee Farm and Semyung Electric 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 WooDeumGee Farm with a short position of Semyung Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of WooDeumGee Farm and Semyung Electric.
Diversification Opportunities for WooDeumGee Farm and Semyung Electric
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WooDeumGee and Semyung is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding WooDeumGee Farm Co, and Semyung Electric Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semyung Electric Mac and WooDeumGee Farm 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 WooDeumGee Farm Co, are associated (or correlated) with Semyung Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semyung Electric Mac has no effect on the direction of WooDeumGee Farm i.e., WooDeumGee Farm and Semyung Electric go up and down completely randomly.
Pair Corralation between WooDeumGee Farm and Semyung Electric
Assuming the 90 days trading horizon WooDeumGee Farm Co, is expected to generate 0.49 times more return on investment than Semyung Electric. However, WooDeumGee Farm Co, is 2.05 times less risky than Semyung Electric. It trades about 0.04 of its potential returns per unit of risk. Semyung Electric Machinery is currently generating about 0.0 per unit of risk. If you would invest 142,700 in WooDeumGee Farm Co, on November 28, 2024 and sell it today you would earn a total of 1,200 from holding WooDeumGee Farm Co, or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WooDeumGee Farm Co, vs. Semyung Electric Machinery
Performance |
| Timeline |
| WooDeumGee Farm Co, |
| Semyung Electric Mac |
WooDeumGee Farm and Semyung Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WooDeumGee Farm and Semyung Electric
The main advantage of trading using opposite WooDeumGee Farm and Semyung Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WooDeumGee Farm position performs unexpectedly, Semyung Electric 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 Semyung Electric will offset losses from the drop in Semyung Electric's long position.| WooDeumGee Farm vs. Hyosung Advanced Materials | WooDeumGee Farm vs. PI Advanced Materials | WooDeumGee Farm vs. Wonil Special Steel | WooDeumGee Farm vs. National Plastic Co |
| Semyung Electric vs. Lotte Fine Chemical | Semyung Electric vs. Echomarketing CoLtd | Semyung Electric vs. Kukdo Chemical Co | Semyung Electric vs. SK Chemicals Co |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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