Correlation Between Korean Reinsurance and INFINITT Healthcare
Can any of the company-specific risk be diversified away by investing in both Korean Reinsurance and INFINITT Healthcare 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 Korean Reinsurance and INFINITT Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korean Reinsurance Co and INFINITT Healthcare Co, you can compare the effects of market volatilities on Korean Reinsurance and INFINITT Healthcare 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 Korean Reinsurance with a short position of INFINITT Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korean Reinsurance and INFINITT Healthcare.
Diversification Opportunities for Korean Reinsurance and INFINITT Healthcare
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Korean and INFINITT is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Korean Reinsurance Co and INFINITT Healthcare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INFINITT Healthcare and Korean Reinsurance 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 Korean Reinsurance Co are associated (or correlated) with INFINITT Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INFINITT Healthcare has no effect on the direction of Korean Reinsurance i.e., Korean Reinsurance and INFINITT Healthcare go up and down completely randomly.
Pair Corralation between Korean Reinsurance and INFINITT Healthcare
Assuming the 90 days trading horizon Korean Reinsurance Co is expected to generate 0.74 times more return on investment than INFINITT Healthcare. However, Korean Reinsurance Co is 1.36 times less risky than INFINITT Healthcare. It trades about 0.08 of its potential returns per unit of risk. INFINITT Healthcare Co is currently generating about -0.03 per unit of risk. If you would invest 489,667 in Korean Reinsurance Co on September 1, 2024 and sell it today you would earn a total of 321,333 from holding Korean Reinsurance Co or generate 65.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korean Reinsurance Co vs. INFINITT Healthcare Co
Performance |
| Timeline |
| Korean Reinsurance |
| INFINITT Healthcare |
Korean Reinsurance and INFINITT Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korean Reinsurance and INFINITT Healthcare
The main advantage of trading using opposite Korean Reinsurance and INFINITT Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korean Reinsurance position performs unexpectedly, INFINITT Healthcare 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 INFINITT Healthcare will offset losses from the drop in INFINITT Healthcare's long position.| Korean Reinsurance vs. SH Energy Chemical | Korean Reinsurance vs. Namhae Chemical | Korean Reinsurance vs. JC Chemical Co | Korean Reinsurance vs. Sung Bo Chemicals |
| INFINITT Healthcare vs. Netmarble Games Corp | INFINITT Healthcare vs. Kukdong Oil Chemicals | INFINITT Healthcare vs. Miwon Chemicals Co | INFINITT Healthcare vs. TJ media 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |