Correlation Between SK Telecom and Fair Isaac
Can any of the company-specific risk be diversified away by investing in both SK Telecom and Fair Isaac 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 Fair Isaac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Telecom Co, and Fair Isaac, you can compare the effects of market volatilities on SK Telecom and Fair Isaac 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 Fair Isaac. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Telecom and Fair Isaac.
Diversification Opportunities for SK Telecom and Fair Isaac
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between S1KM34 and Fair is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding SK Telecom Co, and Fair Isaac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fair Isaac 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 Co, are associated (or correlated) with Fair Isaac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fair Isaac has no effect on the direction of SK Telecom i.e., SK Telecom and Fair Isaac go up and down completely randomly.
Pair Corralation between SK Telecom and Fair Isaac
Assuming the 90 days trading horizon SK Telecom Co, is expected to generate 0.86 times more return on investment than Fair Isaac. However, SK Telecom Co, is 1.17 times less risky than Fair Isaac. It trades about -0.12 of its potential returns per unit of risk. Fair Isaac is currently generating about -0.41 per unit of risk. If you would invest 3,315 in SK Telecom Co, on October 14, 2024 and sell it today you would lose (97.00) from holding SK Telecom Co, or give up 2.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Telecom Co, vs. Fair Isaac
Performance |
| Timeline |
| SK Telecom Co, |
| Fair Isaac |
SK Telecom and Fair Isaac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Telecom and Fair Isaac
The main advantage of trading using opposite SK Telecom and Fair Isaac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Telecom position performs unexpectedly, Fair Isaac 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 Fair Isaac will offset losses from the drop in Fair Isaac's long position.| SK Telecom vs. Paycom Software | SK Telecom vs. Charter Communications | SK Telecom vs. NXP Semiconductors NV | SK Telecom vs. Bemobi Mobile Tech |
| Fair Isaac vs. Taiwan Semiconductor Manufacturing | Fair Isaac vs. Apple Inc | Fair Isaac vs. Alibaba Group Holding | Fair Isaac vs. Banco Santander Chile |
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 Stocks Directory module to find actively traded stocks across global markets.
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