Correlation Between Shinhan Inverse and Dongwon System
Can any of the company-specific risk be diversified away by investing in both Shinhan Inverse and Dongwon System 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 Dongwon System into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Inverse Silver and Dongwon System, you can compare the effects of market volatilities on Shinhan Inverse and Dongwon System 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 Dongwon System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Inverse and Dongwon System.
Diversification Opportunities for Shinhan Inverse and Dongwon System
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shinhan and Dongwon is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Inverse Silver and Dongwon System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwon System 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 Silver are associated (or correlated) with Dongwon System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwon System has no effect on the direction of Shinhan Inverse i.e., Shinhan Inverse and Dongwon System go up and down completely randomly.
Pair Corralation between Shinhan Inverse and Dongwon System
Assuming the 90 days trading horizon Shinhan Inverse Silver is expected to under-perform the Dongwon System. But the stock apears to be less risky and, when comparing its historical volatility, Shinhan Inverse Silver is 1.62 times less risky than Dongwon System. The stock trades about -0.02 of its potential returns per unit of risk. The Dongwon System is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 4,123,514 in Dongwon System on September 2, 2024 and sell it today you would earn a total of 426,486 from holding Dongwon System or generate 10.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.07% |
| Values | Daily Returns |
Shinhan Inverse Silver vs. Dongwon System
Performance |
| Timeline |
| Shinhan Inverse Silver |
| Dongwon System |
Shinhan Inverse and Dongwon System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Inverse and Dongwon System
The main advantage of trading using opposite Shinhan Inverse and Dongwon System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Inverse position performs unexpectedly, Dongwon System 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 Dongwon System will offset losses from the drop in Dongwon System's long position.| Shinhan Inverse vs. AptaBio Therapeutics | Shinhan Inverse vs. Daewoo SBI SPAC | Shinhan Inverse vs. Dream Security co | Shinhan Inverse vs. Microfriend |
| Dongwon System vs. Wave Electronics Co | Dongwon System vs. Sungwoo Electronics Co | Dongwon System vs. KT Submarine Telecom | Dongwon System vs. Korea Electronic Certification |
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.
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