Correlation Between Sungmoon Electronics and Woori Financial
Can any of the company-specific risk be diversified away by investing in both Sungmoon Electronics and Woori Financial 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 Sungmoon Electronics and Woori Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sungmoon Electronics Co and Woori Financial Group, you can compare the effects of market volatilities on Sungmoon Electronics and Woori Financial 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 Sungmoon Electronics with a short position of Woori Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungmoon Electronics and Woori Financial.
Diversification Opportunities for Sungmoon Electronics and Woori Financial
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sungmoon and Woori is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sungmoon Electronics Co and Woori Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woori Financial Group and Sungmoon Electronics 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 Sungmoon Electronics Co are associated (or correlated) with Woori Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woori Financial Group has no effect on the direction of Sungmoon Electronics i.e., Sungmoon Electronics and Woori Financial go up and down completely randomly.
Pair Corralation between Sungmoon Electronics and Woori Financial
Assuming the 90 days trading horizon Sungmoon Electronics Co is expected to generate 2.8 times more return on investment than Woori Financial. However, Sungmoon Electronics is 2.8 times more volatile than Woori Financial Group. It trades about 0.0 of its potential returns per unit of risk. Woori Financial Group is currently generating about -0.16 per unit of risk. If you would invest 465,000 in Sungmoon Electronics Co on September 23, 2024 and sell it today you would lose (15,000) from holding Sungmoon Electronics Co or give up 3.23% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Sungmoon Electronics Co vs. Woori Financial Group
Performance |
Timeline |
Sungmoon Electronics |
Woori Financial Group |
Sungmoon Electronics and Woori Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sungmoon Electronics and Woori Financial
The main advantage of trading using opposite Sungmoon Electronics and Woori Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungmoon Electronics position performs unexpectedly, Woori Financial 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 Woori Financial will offset losses from the drop in Woori Financial's long position.Sungmoon Electronics vs. Samsung Electronics Co | Sungmoon Electronics vs. Seoul Electronics Telecom | Sungmoon Electronics vs. RFTech Co | Sungmoon Electronics vs. Amogreentech Co |
Woori Financial vs. Innowireless Co | Woori Financial vs. Green Cross Medical | Woori Financial vs. Kukil Metal Co | Woori Financial vs. Sungmoon Electronics Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |