Correlation Between Shinhan Financial and Sayona Mining
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Sayona Mining 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 Sayona Mining 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 Sayona Mining Limited, you can compare the effects of market volatilities on Shinhan Financial and Sayona Mining 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 Sayona Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Sayona Mining.
Diversification Opportunities for Shinhan Financial and Sayona Mining
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shinhan and Sayona is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Sayona Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sayona Mining Limited 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 Sayona Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sayona Mining Limited has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Sayona Mining go up and down completely randomly.
Pair Corralation between Shinhan Financial and Sayona Mining
Considering the 90-day investment horizon Shinhan Financial Group is expected to under-perform the Sayona Mining. But the stock apears to be less risky and, when comparing its historical volatility, Shinhan Financial Group is 3.47 times less risky than Sayona Mining. The stock trades about -0.02 of its potential returns per unit of risk. The Sayona Mining Limited is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1.60 in Sayona Mining Limited on August 31, 2024 and sell it today you would earn a total of 0.40 from holding Sayona Mining Limited or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Financial Group vs. Sayona Mining Limited
Performance |
| Timeline |
| Shinhan Financial |
| Sayona Mining Limited |
Shinhan Financial and Sayona Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Sayona Mining
The main advantage of trading using opposite Shinhan Financial and Sayona Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Sayona Mining 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 Sayona Mining will offset losses from the drop in Sayona Mining'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 |
| Sayona Mining vs. Portofino Resources | Sayona Mining vs. Core Lithium | Sayona Mining vs. Global Energy Metals | Sayona Mining vs. Clime Investment Management |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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