Correlation Between SK TELECOM and HMS Bergbau
Can any of the company-specific risk be diversified away by investing in both SK TELECOM and HMS Bergbau 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 HMS Bergbau 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 HMS Bergbau AG, you can compare the effects of market volatilities on SK TELECOM and HMS Bergbau 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 HMS Bergbau. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK TELECOM and HMS Bergbau.
Diversification Opportunities for SK TELECOM and HMS Bergbau
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between KMBA and HMS is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding SK TELECOM TDADR and HMS Bergbau AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HMS Bergbau AG 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 HMS Bergbau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HMS Bergbau AG has no effect on the direction of SK TELECOM i.e., SK TELECOM and HMS Bergbau go up and down completely randomly.
Pair Corralation between SK TELECOM and HMS Bergbau
Assuming the 90 days trading horizon SK TELECOM TDADR is expected to generate 3.69 times more return on investment than HMS Bergbau. However, SK TELECOM is 3.69 times more volatile than HMS Bergbau AG. It trades about 0.19 of its potential returns per unit of risk. HMS Bergbau AG is currently generating about 0.14 per unit of risk. If you would invest 1,970 in SK TELECOM TDADR on September 2, 2024 and sell it today you would earn a total of 290.00 from holding SK TELECOM TDADR or generate 14.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK TELECOM TDADR vs. HMS Bergbau AG
Performance |
| Timeline |
| SK TELECOM TDADR |
| HMS Bergbau AG |
SK TELECOM and HMS Bergbau Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK TELECOM and HMS Bergbau
The main advantage of trading using opposite SK TELECOM and HMS Bergbau positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK TELECOM position performs unexpectedly, HMS Bergbau 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 HMS Bergbau will offset losses from the drop in HMS Bergbau's long position.| SK TELECOM vs. LG Display Co | SK TELECOM vs. United Airlines Holdings | SK TELECOM vs. Cleanaway Waste Management | SK TELECOM vs. PT Global Mediacom |
| HMS Bergbau vs. YATRA ONLINE DL 0001 | HMS Bergbau vs. Entravision Communications | HMS Bergbau vs. Iridium Communications | HMS Bergbau vs. SK TELECOM TDADR |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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