Correlation Between Samlip General and Kiwoom

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

By analyzing existing cross correlation between Samlip General Foods and Kiwoom, you can compare the effects of market volatilities on Samlip General and Kiwoom 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 Samlip General with a short position of Kiwoom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and Kiwoom.

Diversification Opportunities for Samlip General and Kiwoom

0.12

Correlation Coefficient

Samlip General  Kiwoom

Average diversification

The 3 months correlation between Samlip and Kiwoom is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and Kiwoom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kiwoom and Samlip General 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 Samlip General Foods are associated (or correlated) with Kiwoom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kiwoom has no effect on the direction of Samlip General i.e., Samlip General and Kiwoom go up and down completely randomly.

Pair Corralation between Samlip General and Kiwoom

Assuming the 90 days trading horizon Samlip General Foods is expected to generate 0.86 times more return on investment than Kiwoom. However, Samlip General Foods is 1.16 times less risky than Kiwoom. It trades about 0.08 of its potential returns per unit of risk. Kiwoom is currently generating about -0.05 per unit of risk. If you would invest  4,597,427  in Samlip General Foods on December 3, 2024 and sell it today you would earn a total of  377,573  from holding Samlip General Foods or generate 8.21% return on investment over 90 days.

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

Samlip General Foods  vs.  Kiwoom

Samlip General Foods

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Samlip General Foods are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Samlip General may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Kiwoom

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kiwoom has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Samlip General and Kiwoom

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

The idea behind Samlip General Foods and Kiwoom 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.

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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..