Correlation Between Shinhan Financial and Activision Blizzard
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Activision Blizzard 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 Activision Blizzard 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 Activision Blizzard, you can compare the effects of market volatilities on Shinhan Financial and Activision Blizzard 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 Activision Blizzard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Activision Blizzard.
Diversification Opportunities for Shinhan Financial and Activision Blizzard
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shinhan and Activision is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Activision Blizzard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Activision Blizzard 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 Activision Blizzard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Activision Blizzard has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Activision Blizzard go up and down completely randomly.
Pair Corralation between Shinhan Financial and Activision Blizzard
If you would invest 3,396 in Shinhan Financial Group on August 30, 2024 and sell it today you would earn a total of 630.00 from holding Shinhan Financial Group or generate 18.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.79% |
| Values | Daily Returns |
Shinhan Financial Group vs. Activision Blizzard
Performance |
| Timeline |
| Shinhan Financial |
| Activision Blizzard |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Shinhan Financial and Activision Blizzard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Activision Blizzard
The main advantage of trading using opposite Shinhan Financial and Activision Blizzard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Activision Blizzard 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 Activision Blizzard will offset losses from the drop in Activision Blizzard's long position.| Shinhan Financial vs. JPMorgan Chase Co | Shinhan Financial vs. Citigroup | Shinhan Financial vs. Wells Fargo | Shinhan Financial vs. Toronto Dominion Bank |
| Activision Blizzard vs. Take Two Interactive Software | Activision Blizzard vs. Nintendo Co ADR | Activision Blizzard vs. NetEase | Activision Blizzard vs. Playtika Holding Corp |
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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