Correlation Between Kolon Globalco and Ecoplastic
Can any of the company-specific risk be diversified away by investing in both Kolon Globalco and Ecoplastic 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 Kolon Globalco and Ecoplastic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kolon Globalco and Ecoplastic, you can compare the effects of market volatilities on Kolon Globalco and Ecoplastic 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 Kolon Globalco with a short position of Ecoplastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kolon Globalco and Ecoplastic.
Diversification Opportunities for Kolon Globalco and Ecoplastic
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kolon and Ecoplastic is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Kolon Globalco and Ecoplastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecoplastic and Kolon Globalco 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 Kolon Globalco are associated (or correlated) with Ecoplastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecoplastic has no effect on the direction of Kolon Globalco i.e., Kolon Globalco and Ecoplastic go up and down completely randomly.
Pair Corralation between Kolon Globalco and Ecoplastic
Assuming the 90 days trading horizon Kolon Globalco is expected to generate 2.05 times more return on investment than Ecoplastic. However, Kolon Globalco is 2.05 times more volatile than Ecoplastic. It trades about 0.0 of its potential returns per unit of risk. Ecoplastic is currently generating about -0.24 per unit of risk. If you would invest 997,970 in Kolon Globalco on September 4, 2024 and sell it today you would lose (48,970) from holding Kolon Globalco or give up 4.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kolon Globalco vs. Ecoplastic
Performance |
| Timeline |
| Kolon Globalco |
| Ecoplastic |
Kolon Globalco and Ecoplastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kolon Globalco and Ecoplastic
The main advantage of trading using opposite Kolon Globalco and Ecoplastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kolon Globalco position performs unexpectedly, Ecoplastic 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 Ecoplastic will offset losses from the drop in Ecoplastic's long position.| Kolon Globalco vs. Ecoplastic | Kolon Globalco vs. Infinitt Healthcare Co | Kolon Globalco vs. LG Household Healthcare | Kolon Globalco vs. Alton Sports CoLtd |
| Ecoplastic vs. Korea Real Estate | Ecoplastic vs. Busan Industrial Co | Ecoplastic vs. UNISEM Co | Ecoplastic vs. RPBio Inc |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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