Correlation Between Shinhan Financial and Torex Gold
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Torex Gold 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 Torex Gold 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 Torex Gold Resources, you can compare the effects of market volatilities on Shinhan Financial and Torex Gold 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 Torex Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Torex Gold.
Diversification Opportunities for Shinhan Financial and Torex Gold
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shinhan and Torex is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Torex Gold Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Torex Gold Resources 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 Torex Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Torex Gold Resources has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Torex Gold go up and down completely randomly.
Pair Corralation between Shinhan Financial and Torex Gold
Considering the 90-day investment horizon Shinhan Financial Group is expected to generate 0.61 times more return on investment than Torex Gold. However, Shinhan Financial Group is 1.65 times less risky than Torex Gold. It trades about -0.02 of its potential returns per unit of risk. Torex Gold Resources is currently generating about -0.02 per unit of risk. If you would invest 4,086 in Shinhan Financial Group on August 30, 2024 and sell it today you would lose (60.00) from holding Shinhan Financial Group or give up 1.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Financial Group vs. Torex Gold Resources
Performance |
| Timeline |
| Shinhan Financial |
| Torex Gold Resources |
Shinhan Financial and Torex Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Torex Gold
The main advantage of trading using opposite Shinhan Financial and Torex Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Torex Gold 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 Torex Gold will offset losses from the drop in Torex Gold's long position.| Shinhan Financial vs. JPMorgan Chase Co | Shinhan Financial vs. Citigroup | Shinhan Financial vs. Wells Fargo | Shinhan Financial vs. Toronto Dominion Bank |
| Torex Gold vs. Mink Therapeutics | Torex Gold vs. Tscan Therapeutics | Torex Gold vs. Acumen Pharmaceuticals | Torex Gold vs. Nuvalent |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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