Correlation Between Lotte Non and Mobirix
Can any of the company-specific risk be diversified away by investing in both Lotte Non and Mobirix 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 Lotte Non and Mobirix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Non Life and Mobirix Co, you can compare the effects of market volatilities on Lotte Non and Mobirix 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 Lotte Non with a short position of Mobirix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Non and Mobirix.
Diversification Opportunities for Lotte Non and Mobirix
Excellent diversification
The 3 months correlation between Lotte and Mobirix is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Non Life and Mobirix Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobirix and Lotte Non 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 Lotte Non Life are associated (or correlated) with Mobirix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobirix has no effect on the direction of Lotte Non i.e., Lotte Non and Mobirix go up and down completely randomly.
Pair Corralation between Lotte Non and Mobirix
Assuming the 90 days trading horizon Lotte Non Life is expected to under-perform the Mobirix. In addition to that, Lotte Non is 1.2 times more volatile than Mobirix Co. It trades about -0.09 of its total potential returns per unit of risk. Mobirix Co is currently generating about -0.07 per unit of volatility. If you would invest 716,000 in Mobirix Co on September 3, 2024 and sell it today you would lose (190,000) from holding Mobirix Co or give up 26.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Non Life vs. Mobirix Co
Performance |
| Timeline |
| Lotte Non Life |
| Mobirix |
Lotte Non and Mobirix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Non and Mobirix
The main advantage of trading using opposite Lotte Non and Mobirix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Non position performs unexpectedly, Mobirix 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 Mobirix will offset losses from the drop in Mobirix's long position.| Lotte Non vs. Dongjin Semichem Co | Lotte Non vs. AhnLab Inc | Lotte Non vs. Posco ICT | Lotte Non vs. CJ ENM |
| Mobirix vs. Lotte Chilsung Beverage | Mobirix vs. FNSTech Co | Mobirix vs. Shinsung Delta Tech | Mobirix vs. Samyang Foods 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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