Correlation Between Samyung Trading and Worldex Industry

Can any of the company-specific risk be diversified away by investing in both Samyung Trading and Worldex Industry 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 Samyung Trading and Worldex Industry into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Samyung Trading Co and Worldex Industry Trading, you can compare the effects of market volatilities on Samyung Trading and Worldex Industry 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 Samyung Trading with a short position of Worldex Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyung Trading and Worldex Industry.

Diversification Opportunities for Samyung Trading and Worldex Industry

0.53

Correlation Coefficient

Samyung Trading  Worldex Industry

Very weak diversification

The 3 months correlation between Samyung and Worldex is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Samyung Trading Co and Worldex Industry Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldex Industry Trading and Samyung Trading 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 Samyung Trading Co are associated (or correlated) with Worldex Industry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldex Industry Trading has no effect on the direction of Samyung Trading i.e., Samyung Trading and Worldex Industry go up and down completely randomly.

Pair Corralation between Samyung Trading and Worldex Industry

Assuming the 90 days trading horizon Samyung Trading is expected to generate 2.32 times less return on investment than Worldex Industry. But when comparing it to its historical volatility, Samyung Trading Co is 3.85 times less risky than Worldex Industry. It trades about 0.21 of its potential returns per unit of risk. Worldex Industry Trading is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,639,000  in Worldex Industry Trading on December 26, 2024 and sell it today you would earn a total of  318,000  from holding Worldex Industry Trading or generate 19.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Samyung Trading Co  vs.  Worldex Industry Trading

Samyung Trading

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Samyung Trading Co are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Samyung Trading may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Worldex Industry Trading

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Worldex Industry Trading are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Worldex Industry sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Samyung Trading and Worldex Industry

The main advantage of trading using opposite Samyung Trading and Worldex Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyung Trading position performs unexpectedly, Worldex Industry 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 Worldex Industry will offset losses from the drop in Worldex Industry's long position.

The idea behind Samyung Trading Co and Worldex Industry Trading pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.