Correlation Between Shinsung Delta and SS TECH

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

By analyzing existing cross correlation between Shinsung Delta Tech and SS TECH, you can compare the effects of market volatilities on Shinsung Delta and SS TECH 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 Shinsung Delta with a short position of SS TECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsung Delta and SS TECH.

Diversification Opportunities for Shinsung Delta and SS TECH

-0.79

Correlation Coefficient

Shinsung Delta  SS TECH

Pay attention - limited upside

The 3 months correlation between Shinsung and 101490 is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shinsung Delta Tech and SS TECH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SS TECH and Shinsung Delta 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 Shinsung Delta Tech are associated (or correlated) with SS TECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SS TECH has no effect on the direction of Shinsung Delta i.e., Shinsung Delta and SS TECH go up and down completely randomly.

Pair Corralation between Shinsung Delta and SS TECH

Assuming the 90 days trading horizon Shinsung Delta Tech is expected to under-perform the SS TECH. In addition to that, Shinsung Delta is 1.17 times more volatile than SS TECH. It trades about -0.28 of its total potential returns per unit of risk. SS TECH is currently generating about 0.15 per unit of volatility. If you would invest  2,560,000  in SS TECH on December 30, 2024 and sell it today you would earn a total of  730,000  from holding SS TECH or generate 28.52% return on investment over 90 days.

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

Shinsung Delta Tech  vs.  SS TECH

Shinsung Delta Tech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Shinsung Delta Tech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

SS TECH

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SS TECH are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, SS TECH sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Shinsung Delta and SS TECH

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

The idea behind Shinsung Delta Tech and SS TECH 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 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.