Correlation Between SK TELECOM and SEAZEN GROUP
Can any of the company-specific risk be diversified away by investing in both SK TELECOM and SEAZEN GROUP 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 SK TELECOM and SEAZEN GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK TELECOM TDADR and SEAZEN GROUP LTD, you can compare the effects of market volatilities on SK TELECOM and SEAZEN GROUP 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 SK TELECOM with a short position of SEAZEN GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK TELECOM and SEAZEN GROUP.
Diversification Opportunities for SK TELECOM and SEAZEN GROUP
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between KMBA and SEAZEN is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding SK TELECOM TDADR and SEAZEN GROUP LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEAZEN GROUP LTD and SK TELECOM 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 SK TELECOM TDADR are associated (or correlated) with SEAZEN GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEAZEN GROUP LTD has no effect on the direction of SK TELECOM i.e., SK TELECOM and SEAZEN GROUP go up and down completely randomly.
Pair Corralation between SK TELECOM and SEAZEN GROUP
Assuming the 90 days trading horizon SK TELECOM TDADR is expected to generate 0.66 times more return on investment than SEAZEN GROUP. However, SK TELECOM TDADR is 1.52 times less risky than SEAZEN GROUP. It trades about -0.04 of its potential returns per unit of risk. SEAZEN GROUP LTD is currently generating about -0.06 per unit of risk. If you would invest 2,060 in SK TELECOM TDADR on October 28, 2024 and sell it today you would lose (70.00) from holding SK TELECOM TDADR or give up 3.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.44% |
| Values | Daily Returns |
SK TELECOM TDADR vs. SEAZEN GROUP LTD
Performance |
| Timeline |
| SK TELECOM TDADR |
| SEAZEN GROUP LTD |
SK TELECOM and SEAZEN GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK TELECOM and SEAZEN GROUP
The main advantage of trading using opposite SK TELECOM and SEAZEN GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK TELECOM position performs unexpectedly, SEAZEN GROUP 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 SEAZEN GROUP will offset losses from the drop in SEAZEN GROUP's long position.| SK TELECOM vs. CNVISION MEDIA | SK TELECOM vs. RCS MediaGroup SpA | SK TELECOM vs. ZINC MEDIA GR | SK TELECOM vs. ATRESMEDIA |
| SEAZEN GROUP vs. FORWARD AIR P | SEAZEN GROUP vs. Titan Machinery | SEAZEN GROUP vs. Air New Zealand | SEAZEN GROUP vs. SEALED AIR |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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