Correlation Between Shinhan Inverse and MetaLabs
Can any of the company-specific risk be diversified away by investing in both Shinhan Inverse and MetaLabs 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 MetaLabs 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 MetaLabs Co, you can compare the effects of market volatilities on Shinhan Inverse and MetaLabs 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 MetaLabs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Inverse and MetaLabs.
Diversification Opportunities for Shinhan Inverse and MetaLabs
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shinhan and MetaLabs is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Inverse Copper and MetaLabs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetaLabs 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 MetaLabs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetaLabs has no effect on the direction of Shinhan Inverse i.e., Shinhan Inverse and MetaLabs go up and down completely randomly.
Pair Corralation between Shinhan Inverse and MetaLabs
Assuming the 90 days trading horizon Shinhan Inverse Copper is expected to under-perform the MetaLabs. But the stock apears to be less risky and, when comparing its historical volatility, Shinhan Inverse Copper is 1.1 times less risky than MetaLabs. The stock trades about -0.22 of its potential returns per unit of risk. The MetaLabs Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 131,800 in MetaLabs Co on November 3, 2024 and sell it today you would earn a total of 2,200 from holding MetaLabs Co or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Shinhan Inverse Copper vs. MetaLabs Co
Performance |
| Timeline |
| Shinhan Inverse Copper |
| MetaLabs |
Shinhan Inverse and MetaLabs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Inverse and MetaLabs
The main advantage of trading using opposite Shinhan Inverse and MetaLabs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Inverse position performs unexpectedly, MetaLabs 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 MetaLabs will offset losses from the drop in MetaLabs' long position.| Shinhan Inverse vs. Polaris Office Corp | Shinhan Inverse vs. Grand Korea Leisure | Shinhan Inverse vs. Korean Reinsurance Co | Shinhan Inverse vs. Shinhan Inverse Silver |
| MetaLabs vs. Dongbang Transport Logistics | MetaLabs vs. KMH Hitech Co | MetaLabs vs. Korea Alcohol Industrial | MetaLabs vs. Orbitech 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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