Correlation Between Shinhan Inverse and Jin Air
Can any of the company-specific risk be diversified away by investing in both Shinhan Inverse and Jin Air 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 Shinhan Inverse and Jin Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Inverse WTI and Jin Air Co, you can compare the effects of market volatilities on Shinhan Inverse and Jin Air 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 Shinhan Inverse with a short position of Jin Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Inverse and Jin Air.
Diversification Opportunities for Shinhan Inverse and Jin Air
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinhan and Jin is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Inverse WTI and Jin Air Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jin Air and Shinhan Inverse 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 Shinhan Inverse WTI are associated (or correlated) with Jin Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jin Air has no effect on the direction of Shinhan Inverse i.e., Shinhan Inverse and Jin Air go up and down completely randomly.
Pair Corralation between Shinhan Inverse and Jin Air
Assuming the 90 days trading horizon Shinhan Inverse WTI is expected to generate 0.86 times more return on investment than Jin Air. However, Shinhan Inverse WTI is 1.16 times less risky than Jin Air. It trades about -0.01 of its potential returns per unit of risk. Jin Air Co is currently generating about -0.04 per unit of risk. If you would invest 305,000 in Shinhan Inverse WTI on November 9, 2024 and sell it today you would lose (40,500) from holding Shinhan Inverse WTI or give up 13.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.58% |
| Values | Daily Returns |
Shinhan Inverse WTI vs. Jin Air Co
Performance |
| Timeline |
| Shinhan Inverse WTI |
| Jin Air |
Shinhan Inverse and Jin Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Inverse and Jin Air
The main advantage of trading using opposite Shinhan Inverse and Jin Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Inverse position performs unexpectedly, Jin Air 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 Jin Air will offset losses from the drop in Jin Air's long position.| Shinhan Inverse vs. PJ Metal Co | Shinhan Inverse vs. Nable Communications | Shinhan Inverse vs. Korea Information Communications | Shinhan Inverse vs. Lotte Data Communication |
| Jin Air vs. SM Entertainment Co | Jin Air vs. SKONEC Entertainment Co | Jin Air vs. Jeju Beer Co | Jin Air vs. Worldex Industry Trading |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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