Correlation Between Shinhan Inverse and SM Culture
Can any of the company-specific risk be diversified away by investing in both Shinhan Inverse and SM Culture 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 SM Culture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Inverse Copper and SM Culture Contents, you can compare the effects of market volatilities on Shinhan Inverse and SM Culture 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 SM Culture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Inverse and SM Culture.
Diversification Opportunities for Shinhan Inverse and SM Culture
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shinhan and 048550 is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Inverse Copper and SM Culture Contents in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SM Culture Contents 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 Copper are associated (or correlated) with SM Culture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SM Culture Contents has no effect on the direction of Shinhan Inverse i.e., Shinhan Inverse and SM Culture go up and down completely randomly.
Pair Corralation between Shinhan Inverse and SM Culture
Assuming the 90 days trading horizon Shinhan Inverse Copper is expected to generate 0.44 times more return on investment than SM Culture. However, Shinhan Inverse Copper is 2.29 times less risky than SM Culture. It trades about 0.04 of its potential returns per unit of risk. SM Culture Contents is currently generating about -0.08 per unit of risk. If you would invest 536,500 in Shinhan Inverse Copper on October 25, 2024 and sell it today you would earn a total of 15,000 from holding Shinhan Inverse Copper or generate 2.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.08% |
| Values | Daily Returns |
Shinhan Inverse Copper vs. SM Culture Contents
Performance |
| Timeline |
| Shinhan Inverse Copper |
| SM Culture Contents |
Shinhan Inverse and SM Culture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Inverse and SM Culture
The main advantage of trading using opposite Shinhan Inverse and SM Culture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Inverse position performs unexpectedly, SM Culture 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 SM Culture will offset losses from the drop in SM Culture's long position.| Shinhan Inverse vs. KB Financial Group | Shinhan Inverse vs. Shinhan Financial Group | Shinhan Inverse vs. Hana Financial | Shinhan Inverse vs. Woori Financial Group |
| SM Culture vs. Dongkuk Structures Construction | SM Culture vs. Shinhan Inverse Copper | SM Culture vs. Nam Hwa Construction | SM Culture vs. PJ Metal 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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