Correlation Between Shinhan Financial and Argent Minerals
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Argent Minerals 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 Shinhan Financial and Argent Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Financial Group and Argent Minerals Limited, you can compare the effects of market volatilities on Shinhan Financial and Argent Minerals 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 Shinhan Financial with a short position of Argent Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Argent Minerals.
Diversification Opportunities for Shinhan Financial and Argent Minerals
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shinhan and Argent is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Argent Minerals Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argent Minerals and Shinhan Financial 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 Shinhan Financial Group are associated (or correlated) with Argent Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argent Minerals has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Argent Minerals go up and down completely randomly.
Pair Corralation between Shinhan Financial and Argent Minerals
Considering the 90-day investment horizon Shinhan Financial Group is expected to under-perform the Argent Minerals. But the stock apears to be less risky and, when comparing its historical volatility, Shinhan Financial Group is 8.55 times less risky than Argent Minerals. The stock trades about -0.05 of its potential returns per unit of risk. The Argent Minerals Limited is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Argent Minerals Limited on August 29, 2024 and sell it today you would earn a total of 2.00 from holding Argent Minerals Limited or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shinhan Financial Group vs. Argent Minerals Limited
Performance |
| Timeline |
| Shinhan Financial |
| Argent Minerals |
Shinhan Financial and Argent Minerals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Argent Minerals
The main advantage of trading using opposite Shinhan Financial and Argent Minerals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Argent Minerals 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 Argent Minerals will offset losses from the drop in Argent Minerals' long position.| Shinhan Financial vs. Community West Bancshares | Shinhan Financial vs. First Financial Northwest | Shinhan Financial vs. Ponce Financial Group | Shinhan Financial vs. Finwise Bancorp |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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