Correlation Between SK TELECOM and G5 Entertainment

Can any of the company-specific risk be diversified away by investing in both SK TELECOM and G5 Entertainment 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 G5 Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between SK TELECOM TDADR and G5 Entertainment AB, you can compare the effects of market volatilities on SK TELECOM and G5 Entertainment 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 G5 Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK TELECOM and G5 Entertainment.

Diversification Opportunities for SK TELECOM and G5 Entertainment

0.64

Correlation Coefficient

SK TELECOM  G5 Entertainment

Poor diversification

The 3 months correlation between KMBA and U3I is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding SK TELECOM TDADR and G5 Entertainment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G5 Entertainment 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 TDADR are associated (or correlated) with G5 Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G5 Entertainment has no effect on the direction of SK TELECOM i.e., SK TELECOM and G5 Entertainment go up and down completely randomly.

Pair Corralation between SK TELECOM and G5 Entertainment

Assuming the 90 days trading horizon SK TELECOM TDADR is expected to under-perform the G5 Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, SK TELECOM TDADR is 2.94 times less risky than G5 Entertainment. The stock trades about -0.21 of its potential returns per unit of risk. The G5 Entertainment AB is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  818.00  in G5 Entertainment AB on July 4, 2025 and sell it today you would lose (1.00) from holding G5 Entertainment AB or give up 0.12% of portfolio value over 90 days.

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

SK TELECOM TDADR  vs.  G5 Entertainment AB

SK TELECOM TDADR

Risk-Adjusted Performance

Weakest

Over the last 90 days SK TELECOM TDADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental drivers, SK TELECOM is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

G5 Entertainment

Risk-Adjusted Performance

Weakest

Over the last 90 days G5 Entertainment AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in November 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with SK TELECOM and G5 Entertainment

The main advantage of trading using opposite SK TELECOM and G5 Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK TELECOM position performs unexpectedly, G5 Entertainment 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 G5 Entertainment will offset losses from the drop in G5 Entertainment's long position.

The idea behind SK TELECOM TDADR and G5 Entertainment AB 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.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.