Correlation Between Silvergate Capital and Woori Financial

Can any of the company-specific risk be diversified away by investing in both Silvergate Capital and Woori Financial 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 Silvergate Capital and Woori Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Silvergate Capital and Woori Financial Group, you can compare the effects of market volatilities on Silvergate Capital and Woori Financial 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 Silvergate Capital with a short position of Woori Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silvergate Capital and Woori Financial.

Diversification Opportunities for Silvergate Capital and Woori Financial

0.0

Correlation Coefficient

Silvergate Capital  Woori Financial

Pay attention - limited upside

The 3 months correlation between Silvergate and Woori is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Silvergate Capital and Woori Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woori Financial Group and Silvergate Capital 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 Silvergate Capital are associated (or correlated) with Woori Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woori Financial Group has no effect on the direction of Silvergate Capital i.e., Silvergate Capital and Woori Financial go up and down completely randomly.

Pair Corralation between Silvergate Capital and Woori Financial

If you would invest  3,192  in Woori Financial Group on December 25, 2024 and sell it today you would earn a total of  247.00  from holding Woori Financial Group or generate 7.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Silvergate Capital  vs.  Woori Financial Group

Silvergate Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Silvergate Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Silvergate Capital is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Woori Financial Group

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Woori Financial Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Woori Financial may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Silvergate Capital and Woori Financial

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

The idea behind Silvergate Capital and Woori Financial Group 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.