Correlation Between Kia Corp and Theragen Etex
Can any of the company-specific risk be diversified away by investing in both Kia Corp and Theragen Etex 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 Kia Corp and Theragen Etex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kia Corp and Theragen Etex CoLtd, you can compare the effects of market volatilities on Kia Corp and Theragen Etex 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 Kia Corp with a short position of Theragen Etex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kia Corp and Theragen Etex.
Diversification Opportunities for Kia Corp and Theragen Etex
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kia and Theragen is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Kia Corp and Theragen Etex CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Theragen Etex CoLtd and Kia Corp 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 Kia Corp are associated (or correlated) with Theragen Etex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Theragen Etex CoLtd has no effect on the direction of Kia Corp i.e., Kia Corp and Theragen Etex go up and down completely randomly.
Pair Corralation between Kia Corp and Theragen Etex
Assuming the 90 days trading horizon Kia Corp is expected to generate 0.99 times more return on investment than Theragen Etex. However, Kia Corp is 1.01 times less risky than Theragen Etex. It trades about 0.03 of its potential returns per unit of risk. Theragen Etex CoLtd is currently generating about -0.02 per unit of risk. If you would invest 9,630,000 in Kia Corp on November 3, 2024 and sell it today you would earn a total of 570,000 from holding Kia Corp or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kia Corp vs. Theragen Etex CoLtd
Performance |
| Timeline |
| Kia Corp |
| Theragen Etex CoLtd |
Kia Corp and Theragen Etex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kia Corp and Theragen Etex
The main advantage of trading using opposite Kia Corp and Theragen Etex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kia Corp position performs unexpectedly, Theragen Etex 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 Theragen Etex will offset losses from the drop in Theragen Etex's long position.| Kia Corp vs. Kyung In Synthetic Corp | Kia Corp vs. Dong A Steel Technology | Kia Corp vs. Asiana Airlines | Kia Corp vs. ENF Technology Co |
| Theragen Etex vs. Kbi Metal Co | Theragen Etex vs. Dongil Metal Co | Theragen Etex vs. Eagon Industrial Co | Theragen Etex vs. Formetal Co |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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