Correlation Between Korea Industrial and Kyung In
Can any of the company-specific risk be diversified away by investing in both Korea Industrial and Kyung In 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 Korea Industrial and Kyung In into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Industrial Co and Kyung In Synthetic Corp, you can compare the effects of market volatilities on Korea Industrial and Kyung In 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 Korea Industrial with a short position of Kyung In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Industrial and Kyung In.
Diversification Opportunities for Korea Industrial and Kyung In
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Korea and Kyung is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Korea Industrial Co and Kyung In Synthetic Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kyung In Synthetic and Korea Industrial 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 Korea Industrial Co are associated (or correlated) with Kyung In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kyung In Synthetic has no effect on the direction of Korea Industrial i.e., Korea Industrial and Kyung In go up and down completely randomly.
Pair Corralation between Korea Industrial and Kyung In
Assuming the 90 days trading horizon Korea Industrial Co is expected to generate 1.48 times more return on investment than Kyung In. However, Korea Industrial is 1.48 times more volatile than Kyung In Synthetic Corp. It trades about 0.27 of its potential returns per unit of risk. Kyung In Synthetic Corp is currently generating about -0.07 per unit of risk. If you would invest 271,000 in Korea Industrial Co on November 7, 2024 and sell it today you would earn a total of 26,000 from holding Korea Industrial Co or generate 9.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Industrial Co vs. Kyung In Synthetic Corp
Performance |
| Timeline |
| Korea Industrial |
| Kyung In Synthetic |
Korea Industrial and Kyung In Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Industrial and Kyung In
The main advantage of trading using opposite Korea Industrial and Kyung In positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Industrial position performs unexpectedly, Kyung In 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 Kyung In will offset losses from the drop in Kyung In's long position.| Korea Industrial vs. AptaBio Therapeutics | Korea Industrial vs. Daewoo SBI SPAC | Korea Industrial vs. Dream Security co | Korea Industrial vs. Microfriend |
| Kyung In vs. AptaBio Therapeutics | Kyung In vs. Daewoo SBI SPAC | Kyung In vs. Dream Security co | Kyung In vs. Microfriend |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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