Correlation Between Jahwa Electron and Samyoung M

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

By analyzing existing cross correlation between Jahwa Electron and Samyoung M Tek Co, you can compare the effects of market volatilities on Jahwa Electron and Samyoung M 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 Jahwa Electron with a short position of Samyoung M. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jahwa Electron and Samyoung M.

Diversification Opportunities for Jahwa Electron and Samyoung M

0.23

Correlation Coefficient

Jahwa Electron  Samyoung M

Modest diversification

The 3 months correlation between Jahwa and Samyoung is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Jahwa Electron and Samyoung M Tek Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyoung M Tek and Jahwa Electron 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 Jahwa Electron are associated (or correlated) with Samyoung M. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyoung M Tek has no effect on the direction of Jahwa Electron i.e., Jahwa Electron and Samyoung M go up and down completely randomly.

Pair Corralation between Jahwa Electron and Samyoung M

Assuming the 90 days trading horizon Jahwa Electron is expected to generate 1.36 times less return on investment than Samyoung M. In addition to that, Jahwa Electron is 1.16 times more volatile than Samyoung M Tek Co. It trades about 0.06 of its total potential returns per unit of risk. Samyoung M Tek Co is currently generating about 0.09 per unit of volatility. If you would invest  435,804  in Samyoung M Tek Co on December 24, 2024 and sell it today you would earn a total of  61,196  from holding Samyoung M Tek Co or generate 14.04% return on investment over 90 days.

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

Jahwa Electron  vs.  Samyoung M Tek Co

Jahwa Electron

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jahwa Electron are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jahwa Electron sustained solid returns over the last few months and may actually be approaching a breakup point.

Samyoung M Tek

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Samyoung M Tek Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Samyoung M sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jahwa Electron and Samyoung M

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

The idea behind Jahwa Electron and Samyoung M Tek Co 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.