Correlation Between Cots Technology and Sam Yang
Can any of the company-specific risk be diversified away by investing in both Cots Technology 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 Cots Technology and Sam Yang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cots Technology Co and Sam Yang Foods, you can compare the effects of market volatilities on Cots Technology 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 Cots Technology with a short position of Sam Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cots Technology and Sam Yang.
Diversification Opportunities for Cots Technology and Sam Yang
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cots and Sam is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Cots Technology Co 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 Cots Technology 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 Cots Technology Co 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 Cots Technology i.e., Cots Technology and Sam Yang go up and down completely randomly.
Pair Corralation between Cots Technology and Sam Yang
Assuming the 90 days trading horizon Cots Technology is expected to generate 5.78 times less return on investment than Sam Yang. In addition to that, Cots Technology is 1.21 times more volatile than Sam Yang Foods. It trades about 0.02 of its total potential returns per unit of risk. Sam Yang Foods is currently generating about 0.14 per unit of volatility. If you would invest 18,700,400 in Sam Yang Foods on December 13, 2024 and sell it today you would earn a total of 69,299,600 from holding Sam Yang Foods or generate 370.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cots Technology Co vs. Sam Yang Foods
Performance |
| Timeline |
| Cots Technology |
| Sam Yang Foods |
Cots Technology and Sam Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cots Technology and Sam Yang
The main advantage of trading using opposite Cots Technology and Sam Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cots Technology 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.| Cots Technology vs. KT Submarine Telecom | ||
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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