Correlation Between LG Display and SUN ART
Can any of the company-specific risk be diversified away by investing in both LG Display and SUN ART 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 LG Display and SUN ART into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LG Display Co and SUN ART RETAIL, you can compare the effects of market volatilities on LG Display and SUN ART 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 LG Display with a short position of SUN ART. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG Display and SUN ART.
Diversification Opportunities for LG Display and SUN ART
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between LGA and SUN is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding LG Display Co and SUN ART RETAIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUN ART RETAIL and LG Display 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 LG Display Co are associated (or correlated) with SUN ART. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUN ART RETAIL has no effect on the direction of LG Display i.e., LG Display and SUN ART go up and down completely randomly.
Pair Corralation between LG Display and SUN ART
Assuming the 90 days horizon LG Display Co is expected to generate 0.53 times more return on investment than SUN ART. However, LG Display Co is 1.88 times less risky than SUN ART. It trades about 0.07 of its potential returns per unit of risk. SUN ART RETAIL is currently generating about -0.3 per unit of risk. If you would invest 280.00 in LG Display Co on April 10, 2025 and sell it today you would earn a total of 8.00 from holding LG Display Co or generate 2.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
LG Display Co vs. SUN ART RETAIL
Performance |
Timeline |
LG Display |
SUN ART RETAIL |
LG Display and SUN ART Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with LG Display and SUN ART
The main advantage of trading using opposite LG Display and SUN ART positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG Display position performs unexpectedly, SUN ART 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 SUN ART will offset losses from the drop in SUN ART's long position.LG Display vs. CITY OFFICE REIT | LG Display vs. SHIN ETSU CHEMICAL | LG Display vs. Jacquet Metal Service | LG Display vs. Sekisui Chemical Co |
SUN ART vs. REINET INVESTMENTS SCA | SUN ART vs. REGAL ASIAN INVESTMENTS | SUN ART vs. ALLFUNDS GROUP EO 0025 | SUN ART vs. SEI INVESTMENTS |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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