Correlation Between PJ Electronics and Parksystems Corp
Can any of the company-specific risk be diversified away by investing in both PJ Electronics and Parksystems Corp 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 PJ Electronics and Parksystems Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PJ Electronics Co and Parksystems Corp, you can compare the effects of market volatilities on PJ Electronics and Parksystems Corp 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 PJ Electronics with a short position of Parksystems Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJ Electronics and Parksystems Corp.
Diversification Opportunities for PJ Electronics and Parksystems Corp
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between 006140 and Parksystems is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding PJ Electronics Co and Parksystems Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Parksystems Corp and PJ Electronics 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 PJ Electronics Co are associated (or correlated) with Parksystems Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Parksystems Corp has no effect on the direction of PJ Electronics i.e., PJ Electronics and Parksystems Corp go up and down completely randomly.
Pair Corralation between PJ Electronics and Parksystems Corp
Assuming the 90 days trading horizon PJ Electronics Co is expected to under-perform the Parksystems Corp. In addition to that, PJ Electronics is 1.07 times more volatile than Parksystems Corp. It trades about 0.0 of its total potential returns per unit of risk. Parksystems Corp is currently generating about 0.05 per unit of volatility. If you would invest 11,454,900 in Parksystems Corp on September 4, 2024 and sell it today you would earn a total of 8,535,100 from holding Parksystems Corp or generate 74.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJ Electronics Co vs. Parksystems Corp
Performance |
| Timeline |
| PJ Electronics |
| Parksystems Corp |
PJ Electronics and Parksystems Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJ Electronics and Parksystems Corp
The main advantage of trading using opposite PJ Electronics and Parksystems Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJ Electronics position performs unexpectedly, Parksystems Corp 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 Parksystems Corp will offset losses from the drop in Parksystems Corp's long position.| PJ Electronics vs. Daejoo Electronic Materials | PJ Electronics vs. Parksystems Corp | PJ Electronics vs. BH Co | PJ Electronics vs. Partron Co |
| Parksystems Corp vs. Vitzro Tech Co | Parksystems Corp vs. Sempio Foods Co | Parksystems Corp vs. Woori Technology | Parksystems Corp vs. Taegu Broadcasting |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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