Correlation Between Shinhan Financial and Citius Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Citius Pharmaceuticals 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 Citius Pharmaceuticals 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 Citius Pharmaceuticals, you can compare the effects of market volatilities on Shinhan Financial and Citius Pharmaceuticals 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 Citius Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Citius Pharmaceuticals.
Diversification Opportunities for Shinhan Financial and Citius Pharmaceuticals
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shinhan and Citius is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Citius Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citius Pharmaceuticals 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 Citius Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citius Pharmaceuticals has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Citius Pharmaceuticals go up and down completely randomly.
Pair Corralation between Shinhan Financial and Citius Pharmaceuticals
Considering the 90-day investment horizon Shinhan Financial Group is expected to generate 0.36 times more return on investment than Citius Pharmaceuticals. However, Shinhan Financial Group is 2.76 times less risky than Citius Pharmaceuticals. It trades about 0.05 of its potential returns per unit of risk. Citius Pharmaceuticals is currently generating about -0.05 per unit of risk. If you would invest 2,649 in Shinhan Financial Group on September 2, 2024 and sell it today you would earn a total of 1,209 from holding Shinhan Financial Group or generate 45.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Financial Group vs. Citius Pharmaceuticals
Performance |
| Timeline |
| Shinhan Financial |
| Citius Pharmaceuticals |
Shinhan Financial and Citius Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Citius Pharmaceuticals
The main advantage of trading using opposite Shinhan Financial and Citius Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Citius Pharmaceuticals 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 Citius Pharmaceuticals will offset losses from the drop in Citius Pharmaceuticals' 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 |
| Citius Pharmaceuticals vs. X4 Pharmaceuticals | Citius Pharmaceuticals vs. Hookipa Pharma | Citius Pharmaceuticals vs. Mereo BioPharma Group | Citius Pharmaceuticals vs. Acumen Pharmaceuticals |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |