Correlation Between Lake Materials and SK Telecom
Can any of the company-specific risk be diversified away by investing in both Lake Materials and SK Telecom 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 Lake Materials and SK Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lake Materials Co and SK Telecom Co, you can compare the effects of market volatilities on Lake Materials and SK Telecom 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 Lake Materials with a short position of SK Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lake Materials and SK Telecom.
Diversification Opportunities for Lake Materials and SK Telecom
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lake and 017670 is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Lake Materials Co and SK Telecom Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Telecom and Lake Materials 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 Lake Materials Co are associated (or correlated) with SK Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Telecom has no effect on the direction of Lake Materials i.e., Lake Materials and SK Telecom go up and down completely randomly.
Pair Corralation between Lake Materials and SK Telecom
Assuming the 90 days trading horizon Lake Materials Co is expected to generate 4.81 times more return on investment than SK Telecom. However, Lake Materials is 4.81 times more volatile than SK Telecom Co. It trades about 0.18 of its potential returns per unit of risk. SK Telecom Co is currently generating about -0.03 per unit of risk. If you would invest 1,069,167 in Lake Materials Co on December 5, 2024 and sell it today you would earn a total of 618,833 from holding Lake Materials Co or generate 57.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Lake Materials Co vs. SK Telecom Co
Performance |
Timeline |
Lake Materials |
SK Telecom |
Lake Materials and SK Telecom Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lake Materials and SK Telecom
The main advantage of trading using opposite Lake Materials and SK Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lake Materials position performs unexpectedly, SK Telecom 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 SK Telecom will offset losses from the drop in SK Telecom's long position.Lake Materials vs. Sam Yang Foods | Lake Materials vs. Tuksu Engineering ConstructionLtd | Lake Materials vs. Samlip General Foods | Lake Materials vs. ENERGYMACHINERY KOREA CoLtd |
SK Telecom vs. Hyosung Advanced Materials | SK Telecom vs. Jeju Air Co | SK Telecom vs. PI Advanced Materials | SK Telecom vs. Sung Bo Chemicals |
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.
Other Complementary Tools
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |