Correlation Between SEB SA and GungHo Online
Can any of the company-specific risk be diversified away by investing in both SEB SA and GungHo Online 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 SEB SA and GungHo Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEB SA and GungHo Online Entertainment, you can compare the effects of market volatilities on SEB SA and GungHo Online 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 SEB SA with a short position of GungHo Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEB SA and GungHo Online.
Diversification Opportunities for SEB SA and GungHo Online
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SEB and GungHo is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding SEB SA and GungHo Online Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GungHo Online Entert and SEB SA 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 SEB SA are associated (or correlated) with GungHo Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GungHo Online Entert has no effect on the direction of SEB SA i.e., SEB SA and GungHo Online go up and down completely randomly.
Pair Corralation between SEB SA and GungHo Online
Assuming the 90 days horizon SEB SA is expected to generate 0.78 times more return on investment than GungHo Online. However, SEB SA is 1.29 times less risky than GungHo Online. It trades about -0.01 of its potential returns per unit of risk. GungHo Online Entertainment is currently generating about -0.05 per unit of risk. If you would invest 9,570 in SEB SA on September 12, 2024 and sell it today you would lose (90.00) from holding SEB SA or give up 0.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEB SA vs. GungHo Online Entertainment
Performance |
| Timeline |
| SEB SA |
| GungHo Online Entert |
SEB SA and GungHo Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEB SA and GungHo Online
The main advantage of trading using opposite SEB SA and GungHo Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEB SA position performs unexpectedly, GungHo Online 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 GungHo Online will offset losses from the drop in GungHo Online's long position.| SEB SA vs. Suntory Beverage Food | SEB SA vs. ScanSource | SEB SA vs. YOOMA WELLNESS INC | SEB SA vs. Natural Health Trends |
| GungHo Online vs. NEXON Co | GungHo Online vs. Take Two Interactive Software | GungHo Online vs. Superior Plus Corp | GungHo Online vs. SIVERS SEMICONDUCTORS AB |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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