Correlation Between Semyung Electric and Chinyang Hold
Can any of the company-specific risk be diversified away by investing in both Semyung Electric and Chinyang Hold 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 Semyung Electric and Chinyang Hold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Semyung Electric Machinery and Chinyang Hold, you can compare the effects of market volatilities on Semyung Electric and Chinyang Hold 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 Semyung Electric with a short position of Chinyang Hold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semyung Electric and Chinyang Hold.
Diversification Opportunities for Semyung Electric and Chinyang Hold
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Semyung and Chinyang is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Semyung Electric Machinery and Chinyang Hold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chinyang Hold and Semyung Electric 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 Semyung Electric Machinery are associated (or correlated) with Chinyang Hold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chinyang Hold has no effect on the direction of Semyung Electric i.e., Semyung Electric and Chinyang Hold go up and down completely randomly.
Pair Corralation between Semyung Electric and Chinyang Hold
Assuming the 90 days trading horizon Semyung Electric Machinery is expected to generate 4.96 times more return on investment than Chinyang Hold. However, Semyung Electric is 4.96 times more volatile than Chinyang Hold. It trades about 0.04 of its potential returns per unit of risk. Chinyang Hold is currently generating about 0.04 per unit of risk. If you would invest 277,488 in Semyung Electric Machinery on September 24, 2024 and sell it today you would earn a total of 179,012 from holding Semyung Electric Machinery or generate 64.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Semyung Electric Machinery vs. Chinyang Hold
Performance |
Timeline |
Semyung Electric Mac |
Chinyang Hold |
Semyung Electric and Chinyang Hold Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Semyung Electric and Chinyang Hold
The main advantage of trading using opposite Semyung Electric and Chinyang Hold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semyung Electric position performs unexpectedly, Chinyang Hold 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 Chinyang Hold will offset losses from the drop in Chinyang Hold's long position.Semyung Electric vs. UJU Electronics Co | Semyung Electric vs. Wave Electronics Co | Semyung Electric vs. Sungwoo Electronics Co | Semyung Electric vs. Cuckoo Electronics Co |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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