Correlation Between Shinhan Financial and Bayport International
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Bayport International 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 Bayport International 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 Bayport International Holdings, you can compare the effects of market volatilities on Shinhan Financial and Bayport International 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 Bayport International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Bayport International.
Diversification Opportunities for Shinhan Financial and Bayport International
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shinhan and Bayport is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Bayport International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayport International 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 Bayport International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayport International has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Bayport International go up and down completely randomly.
Pair Corralation between Shinhan Financial and Bayport International
Considering the 90-day investment horizon Shinhan Financial Group is expected to generate 0.41 times more return on investment than Bayport International. However, Shinhan Financial Group is 2.43 times less risky than Bayport International. It trades about 0.04 of its potential returns per unit of risk. Bayport International Holdings is currently generating about -0.01 per unit of risk. If you would invest 3,016 in Shinhan Financial Group on November 2, 2024 and sell it today you would earn a total of 486.00 from holding Shinhan Financial Group or generate 16.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Financial Group vs. Bayport International Holdings
Performance |
| Timeline |
| Shinhan Financial |
| Bayport International |
Shinhan Financial and Bayport International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Bayport International
The main advantage of trading using opposite Shinhan Financial and Bayport International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Bayport International 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 Bayport International will offset losses from the drop in Bayport International's 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 |
| Bayport International vs. Hong Kong Land | Bayport International vs. Wharf Holdings | Bayport International vs. Holiday Island Holdings | Bayport International vs. Sun Hung Kai |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |