Correlation Between SK Telecom and DigitalTown
Can any of the company-specific risk be diversified away by investing in both SK Telecom and DigitalTown 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 SK Telecom and DigitalTown into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Telecom Co and DigitalTown, you can compare the effects of market volatilities on SK Telecom and DigitalTown 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 SK Telecom with a short position of DigitalTown. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Telecom and DigitalTown.
Diversification Opportunities for SK Telecom and DigitalTown
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SKM and DigitalTown is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SK Telecom Co and DigitalTown in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DigitalTown and SK Telecom 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 SK Telecom Co are associated (or correlated) with DigitalTown. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DigitalTown has no effect on the direction of SK Telecom i.e., SK Telecom and DigitalTown go up and down completely randomly.
Pair Corralation between SK Telecom and DigitalTown
If you would invest 0.00 in DigitalTown on January 17, 2024 and sell it today you would earn a total of 0.00 from holding DigitalTown or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Telecom Co vs. DigitalTown
Performance |
| Timeline |
| SK Telecom |
| DigitalTown |
SK Telecom and DigitalTown Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Telecom and DigitalTown
The main advantage of trading using opposite SK Telecom and DigitalTown positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Telecom position performs unexpectedly, DigitalTown 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 DigitalTown will offset losses from the drop in DigitalTown's long position.| SK Telecom vs. Telefonica Brasil SA | SK Telecom vs. Orange SA ADR | SK Telecom vs. Grupo Televisa SAB | SK Telecom vs. Telefonica SA ADR |
| DigitalTown vs. AB International Group | DigitalTown vs. Peer To Peer | DigitalTown vs. AppYea Inc | DigitalTown vs. Protek Capital |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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