Correlation Between Sekisui Chemical and GungHo Online
Can any of the company-specific risk be diversified away by investing in both Sekisui Chemical and GungHo Online 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 Sekisui Chemical and GungHo Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sekisui Chemical Co and GungHo Online Entertainment, you can compare the effects of market volatilities on Sekisui Chemical and GungHo Online 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 Sekisui Chemical with a short position of GungHo Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sekisui Chemical and GungHo Online.
Diversification Opportunities for Sekisui Chemical and GungHo Online
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sekisui and GungHo is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Sekisui Chemical Co and GungHo Online Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GungHo Online Entert and Sekisui Chemical 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 Sekisui Chemical Co are associated (or correlated) with GungHo Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GungHo Online Entert has no effect on the direction of Sekisui Chemical i.e., Sekisui Chemical and GungHo Online go up and down completely randomly.
Pair Corralation between Sekisui Chemical and GungHo Online
Assuming the 90 days horizon Sekisui Chemical Co is expected to generate 0.91 times more return on investment than GungHo Online. However, Sekisui Chemical Co is 1.1 times less risky than GungHo Online. It trades about 0.13 of its potential returns per unit of risk. GungHo Online Entertainment is currently generating about -0.05 per unit of risk. If you would invest 1,410 in Sekisui Chemical Co on September 12, 2024 and sell it today you would earn a total of 80.00 from holding Sekisui Chemical Co or generate 5.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sekisui Chemical Co vs. GungHo Online Entertainment
Performance |
| Timeline |
| Sekisui Chemical |
| GungHo Online Entert |
Sekisui Chemical and GungHo Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sekisui Chemical and GungHo Online
The main advantage of trading using opposite Sekisui Chemical and GungHo Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sekisui Chemical position performs unexpectedly, GungHo Online 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 GungHo Online will offset losses from the drop in GungHo Online's long position.| Sekisui Chemical vs. Lennar | Sekisui Chemical vs. Superior Plus Corp | Sekisui Chemical vs. SIVERS SEMICONDUCTORS AB | Sekisui Chemical vs. NorAm Drilling AS |
| GungHo Online vs. NEXON Co | GungHo Online vs. Take Two Interactive Software | GungHo Online vs. Superior Plus Corp | GungHo Online vs. SIVERS SEMICONDUCTORS AB |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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