Correlation Between Shinhan WTI and MiraeAsset TIGER
Can any of the company-specific risk be diversified away by investing in both Shinhan WTI and MiraeAsset TIGER 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 WTI and MiraeAsset TIGER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan WTI Futures and MiraeAsset TIGER Synth Japan, you can compare the effects of market volatilities on Shinhan WTI and MiraeAsset TIGER 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 WTI with a short position of MiraeAsset TIGER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan WTI and MiraeAsset TIGER.
Diversification Opportunities for Shinhan WTI and MiraeAsset TIGER
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shinhan and MiraeAsset is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan WTI Futures and MiraeAsset TIGER Synth Japan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MiraeAsset TIGER Synth and Shinhan WTI 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 WTI Futures are associated (or correlated) with MiraeAsset TIGER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MiraeAsset TIGER Synth has no effect on the direction of Shinhan WTI i.e., Shinhan WTI and MiraeAsset TIGER go up and down completely randomly.
Pair Corralation between Shinhan WTI and MiraeAsset TIGER
Assuming the 90 days trading horizon Shinhan WTI Futures is expected to generate 1.57 times more return on investment than MiraeAsset TIGER. However, Shinhan WTI is 1.57 times more volatile than MiraeAsset TIGER Synth Japan. It trades about 0.03 of its potential returns per unit of risk. MiraeAsset TIGER Synth Japan is currently generating about -0.03 per unit of risk. If you would invest 716,000 in Shinhan WTI Futures on September 1, 2024 and sell it today you would earn a total of 5,500 from holding Shinhan WTI Futures or generate 0.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan WTI Futures vs. MiraeAsset TIGER Synth Japan
Performance |
| Timeline |
| Shinhan WTI Futures |
| MiraeAsset TIGER Synth |
Shinhan WTI and MiraeAsset TIGER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan WTI and MiraeAsset TIGER
The main advantage of trading using opposite Shinhan WTI and MiraeAsset TIGER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan WTI position performs unexpectedly, MiraeAsset TIGER 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 MiraeAsset TIGER will offset losses from the drop in MiraeAsset TIGER's long position.| Shinhan WTI vs. Kaonmedia Co | Shinhan WTI vs. YG Entertainment | Shinhan WTI vs. Dongil Metal Co | Shinhan WTI vs. DONGKUK TED METAL |
| MiraeAsset TIGER vs. Busan Industrial Co | MiraeAsset TIGER vs. Busan Ind | MiraeAsset TIGER vs. Mirae Asset Daewoo | MiraeAsset TIGER vs. Shinhan WTI Futures |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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