Correlation Between Golden Bridge and Grand Korea
Can any of the company-specific risk be diversified away by investing in both Golden Bridge and Grand Korea 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 Golden Bridge and Grand Korea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Bridge Investment and Grand Korea Leisure, you can compare the effects of market volatilities on Golden Bridge and Grand Korea 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 Golden Bridge with a short position of Grand Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Bridge and Grand Korea.
Diversification Opportunities for Golden Bridge and Grand Korea
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Golden and Grand is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Golden Bridge Investment and Grand Korea Leisure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Korea Leisure and Golden Bridge 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 Golden Bridge Investment are associated (or correlated) with Grand Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Korea Leisure has no effect on the direction of Golden Bridge i.e., Golden Bridge and Grand Korea go up and down completely randomly.
Pair Corralation between Golden Bridge and Grand Korea
Assuming the 90 days trading horizon Golden Bridge is expected to generate 4.87 times less return on investment than Grand Korea. But when comparing it to its historical volatility, Golden Bridge Investment is 1.22 times less risky than Grand Korea. It trades about 0.05 of its potential returns per unit of risk. Grand Korea Leisure is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,135,000 in Grand Korea Leisure on October 17, 2024 and sell it today you would earn a total of 57,000 from holding Grand Korea Leisure or generate 5.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Bridge Investment vs. Grand Korea Leisure
Performance |
| Timeline |
| Golden Bridge Investment |
| Grand Korea Leisure |
Golden Bridge and Grand Korea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Bridge and Grand Korea
The main advantage of trading using opposite Golden Bridge and Grand Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Bridge position performs unexpectedly, Grand Korea 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 Grand Korea will offset losses from the drop in Grand Korea's long position.| Golden Bridge vs. Chorokbaem Healthcare Co | Golden Bridge vs. DAEDUCK ELECTRONICS CoLtd | Golden Bridge vs. Infinitt Healthcare Co | Golden Bridge vs. Daeduck Electronics Co |
| Grand Korea vs. Golden Bridge Investment | Grand Korea vs. DSC Investment | Grand Korea vs. Daol Investment Securities | Grand Korea vs. KTB Investment Securities |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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