Correlation Between Tuksu Engineering and Samhwa Paint
Can any of the company-specific risk be diversified away by investing in both Tuksu Engineering and Samhwa Paint 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 Tuksu Engineering and Samhwa Paint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tuksu Engineering ConstructionLtd and Samhwa Paint Industrial, you can compare the effects of market volatilities on Tuksu Engineering and Samhwa Paint 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 Tuksu Engineering with a short position of Samhwa Paint. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tuksu Engineering and Samhwa Paint.
Diversification Opportunities for Tuksu Engineering and Samhwa Paint
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tuksu and Samhwa is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Tuksu Engineering Construction and Samhwa Paint Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhwa Paint Industrial and Tuksu Engineering 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 Tuksu Engineering ConstructionLtd are associated (or correlated) with Samhwa Paint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhwa Paint Industrial has no effect on the direction of Tuksu Engineering i.e., Tuksu Engineering and Samhwa Paint go up and down completely randomly.
Pair Corralation between Tuksu Engineering and Samhwa Paint
Assuming the 90 days trading horizon Tuksu Engineering ConstructionLtd is expected to generate 1.36 times more return on investment than Samhwa Paint. However, Tuksu Engineering is 1.36 times more volatile than Samhwa Paint Industrial. It trades about -0.01 of its potential returns per unit of risk. Samhwa Paint Industrial is currently generating about -0.05 per unit of risk. If you would invest 707,000 in Tuksu Engineering ConstructionLtd on September 25, 2024 and sell it today you would lose (70,000) from holding Tuksu Engineering ConstructionLtd or give up 9.9% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Tuksu Engineering Construction vs. Samhwa Paint Industrial
Performance |
Timeline |
Tuksu Engineering |
Samhwa Paint Industrial |
Tuksu Engineering and Samhwa Paint Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tuksu Engineering and Samhwa Paint
The main advantage of trading using opposite Tuksu Engineering and Samhwa Paint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tuksu Engineering position performs unexpectedly, Samhwa Paint 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 Samhwa Paint will offset losses from the drop in Samhwa Paint's long position.Tuksu Engineering vs. Busan Industrial Co | Tuksu Engineering vs. Busan Ind | Tuksu Engineering vs. Mirae Asset Daewoo | Tuksu Engineering vs. Shinhan WTI Futures |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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