Correlation Between SAMG Entertainment and Shinhan Inverse

Can any of the company-specific risk be diversified away by investing in both SAMG Entertainment and Shinhan Inverse 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 SAMG Entertainment and Shinhan Inverse into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SAMG Entertainment Co and Shinhan Inverse Silver, you can compare the effects of market volatilities on SAMG Entertainment and Shinhan Inverse 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 SAMG Entertainment with a short position of Shinhan Inverse. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAMG Entertainment and Shinhan Inverse.

Diversification Opportunities for SAMG Entertainment and Shinhan Inverse

0.31

Correlation Coefficient

SAMG Entertainment  Shinhan Inverse

Weak diversification

The 3 months correlation between SAMG and Shinhan is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding SAMG Entertainment Co and Shinhan Inverse Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan Inverse Silver and SAMG Entertainment 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 SAMG Entertainment Co are associated (or correlated) with Shinhan Inverse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan Inverse Silver has no effect on the direction of SAMG Entertainment i.e., SAMG Entertainment and Shinhan Inverse go up and down completely randomly.

Pair Corralation between SAMG Entertainment and Shinhan Inverse

Assuming the 90 days trading horizon SAMG Entertainment Co is expected to under-perform the Shinhan Inverse. In addition to that, SAMG Entertainment is 2.0 times more volatile than Shinhan Inverse Silver. It trades about -0.11 of its total potential returns per unit of risk. Shinhan Inverse Silver is currently generating about -0.09 per unit of volatility. If you would invest  383,500  in Shinhan Inverse Silver on September 12, 2024 and sell it today you would lose (43,500) from holding Shinhan Inverse Silver or give up 11.34% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	96.55%
Values	Daily Returns

SAMG Entertainment Co  vs.  Shinhan Inverse Silver

SAMG Entertainment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SAMG Entertainment Co 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 January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Shinhan Inverse Silver

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Shinhan Inverse Silver has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with SAMG Entertainment and Shinhan Inverse

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

The idea behind SAMG Entertainment Co and Shinhan Inverse Silver 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.