Correlation Between GS Engineering and TAEYANG
Can any of the company-specific risk be diversified away by investing in both GS Engineering and TAEYANG 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 GS Engineering and TAEYANG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GS Engineering Construction and TAEYANG, you can compare the effects of market volatilities on GS Engineering and TAEYANG 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 GS Engineering with a short position of TAEYANG. Check out your portfolio center. Please also check ongoing floating volatility patterns of GS Engineering and TAEYANG.
Diversification Opportunities for GS Engineering and TAEYANG
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 006360 and TAEYANG is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding GS Engineering Construction and TAEYANG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TAEYANG and GS Engineering 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 GS Engineering Construction are associated (or correlated) with TAEYANG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TAEYANG has no effect on the direction of GS Engineering i.e., GS Engineering and TAEYANG go up and down completely randomly.
Pair Corralation between GS Engineering and TAEYANG
Assuming the 90 days trading horizon GS Engineering Construction is expected to generate 2.1 times more return on investment than TAEYANG. However, GS Engineering is 2.1 times more volatile than TAEYANG. It trades about 0.0 of its potential returns per unit of risk. TAEYANG is currently generating about -0.02 per unit of risk. If you would invest 2,025,507 in GS Engineering Construction on October 29, 2024 and sell it today you would lose (243,507) from holding GS Engineering Construction or give up 12.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GS Engineering Construction vs. TAEYANG
Performance |
| Timeline |
| GS Engineering Const |
| TAEYANG |
GS Engineering and TAEYANG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GS Engineering and TAEYANG
The main advantage of trading using opposite GS Engineering and TAEYANG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GS Engineering position performs unexpectedly, TAEYANG 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 TAEYANG will offset losses from the drop in TAEYANG's long position.| GS Engineering vs. Seah Steel Corp | GS Engineering vs. Nice Information Telecommunication | GS Engineering vs. Wireless Power Amplifier | GS Engineering vs. Nature and Environment |
| TAEYANG vs. TS Investment Corp | TAEYANG vs. Daol Investment Securities | TAEYANG vs. Atinum Investment Co | TAEYANG vs. Korea Investment Holdings |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |