Correlation Between Amkor Technology and SK TELECOM
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and SK TELECOM 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 Amkor Technology and SK TELECOM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and SK TELECOM TDADR, you can compare the effects of market volatilities on Amkor Technology and SK TELECOM 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 Amkor Technology with a short position of SK TELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and SK TELECOM.
Diversification Opportunities for Amkor Technology and SK TELECOM
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Amkor and KMBA is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and SK TELECOM TDADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK TELECOM TDADR and Amkor Technology 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 Amkor Technology are associated (or correlated) with SK TELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK TELECOM TDADR has no effect on the direction of Amkor Technology i.e., Amkor Technology and SK TELECOM go up and down completely randomly.
Pair Corralation between Amkor Technology and SK TELECOM
Assuming the 90 days horizon Amkor Technology is expected to generate 3.97 times less return on investment than SK TELECOM. In addition to that, Amkor Technology is 1.78 times more volatile than SK TELECOM TDADR. It trades about 0.01 of its total potential returns per unit of risk. SK TELECOM TDADR is currently generating about 0.05 per unit of volatility. If you would invest 1,880 in SK TELECOM TDADR on September 4, 2024 and sell it today you would earn a total of 380.00 from holding SK TELECOM TDADR or generate 20.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amkor Technology vs. SK TELECOM TDADR
Performance |
| Timeline |
| Amkor Technology |
| SK TELECOM TDADR |
Amkor Technology and SK TELECOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and SK TELECOM
The main advantage of trading using opposite Amkor Technology and SK TELECOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, SK TELECOM 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 SK TELECOM will offset losses from the drop in SK TELECOM's long position.| Amkor Technology vs. NVIDIA | Amkor Technology vs. Taiwan Semiconductor Manufacturing | Amkor Technology vs. Advanced Micro Devices | Amkor Technology vs. Intel |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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