Correlation Between FOODWELL and Netmarble Games
Can any of the company-specific risk be diversified away by investing in both FOODWELL and Netmarble Games 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 FOODWELL and Netmarble Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FOODWELL Co and Netmarble Games Corp, you can compare the effects of market volatilities on FOODWELL and Netmarble Games 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 FOODWELL with a short position of Netmarble Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of FOODWELL and Netmarble Games.
Diversification Opportunities for FOODWELL and Netmarble Games
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FOODWELL and Netmarble is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FOODWELL Co and Netmarble Games Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netmarble Games Corp and FOODWELL 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 FOODWELL Co are associated (or correlated) with Netmarble Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netmarble Games Corp has no effect on the direction of FOODWELL i.e., FOODWELL and Netmarble Games go up and down completely randomly.
Pair Corralation between FOODWELL and Netmarble Games
Assuming the 90 days trading horizon FOODWELL Co is expected to generate 0.62 times more return on investment than Netmarble Games. However, FOODWELL Co is 1.62 times less risky than Netmarble Games. It trades about -0.06 of its potential returns per unit of risk. Netmarble Games Corp is currently generating about -0.09 per unit of risk. If you would invest 523,000 in FOODWELL Co on September 3, 2024 and sell it today you would lose (24,000) from holding FOODWELL Co or give up 4.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FOODWELL Co vs. Netmarble Games Corp
Performance |
| Timeline |
| FOODWELL |
| Netmarble Games Corp |
FOODWELL and Netmarble Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FOODWELL and Netmarble Games
The main advantage of trading using opposite FOODWELL and Netmarble Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FOODWELL position performs unexpectedly, Netmarble Games 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 Netmarble Games will offset losses from the drop in Netmarble Games' long position.| FOODWELL vs. Nam Hwa Construction | FOODWELL vs. Daewoo Engineering Construction | FOODWELL vs. Sam Yang Foods | FOODWELL vs. Keyang Electric Machinery |
| Netmarble Games vs. Seoul Food Industrial | Netmarble Games vs. Foodnamoo | Netmarble Games vs. KB Financial Group | Netmarble Games vs. FOODWELL 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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