Correlation Between Samyoung M and Booster

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

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

Diversification Opportunities for Samyoung M and Booster

0.35

Correlation Coefficient

Samyoung M  Booster

Weak diversification

The 3 months correlation between Samyoung and Booster is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Samyoung M Tek Co and Booster Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Booster and Samyoung M 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 Samyoung M Tek Co are associated (or correlated) with Booster. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Booster has no effect on the direction of Samyoung M i.e., Samyoung M and Booster go up and down completely randomly.

Pair Corralation between Samyoung M and Booster

Assuming the 90 days trading horizon Samyoung M Tek Co is expected to generate 2.19 times more return on investment than Booster. However, Samyoung M is 2.19 times more volatile than Booster Co. It trades about 0.0 of its potential returns per unit of risk. Booster Co is currently generating about -0.06 per unit of risk. If you would invest  414,500  in Samyoung M Tek Co on September 12, 2024 and sell it today you would lose (6,500) from holding Samyoung M Tek Co or give up 1.57% of portfolio value over 90 days.

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

Samyoung M Tek Co  vs.  Booster Co

Samyoung M Tek

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Samyoung M Tek Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Samyoung M is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Booster

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Booster Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Booster is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Samyoung M and Booster

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

The idea behind Samyoung M Tek Co and Booster 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.