Correlation Between Tae Kyung and SKONEC Entertainment
Can any of the company-specific risk be diversified away by investing in both Tae Kyung and SKONEC Entertainment 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 Tae Kyung and SKONEC Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tae Kyung Chemical and SKONEC Entertainment Co, you can compare the effects of market volatilities on Tae Kyung and SKONEC Entertainment 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 Tae Kyung with a short position of SKONEC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tae Kyung and SKONEC Entertainment.
Diversification Opportunities for Tae Kyung and SKONEC Entertainment
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tae and SKONEC is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Tae Kyung Chemical and SKONEC Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SKONEC Entertainment and Tae Kyung 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 Tae Kyung Chemical are associated (or correlated) with SKONEC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SKONEC Entertainment has no effect on the direction of Tae Kyung i.e., Tae Kyung and SKONEC Entertainment go up and down completely randomly.
Pair Corralation between Tae Kyung and SKONEC Entertainment
Assuming the 90 days trading horizon Tae Kyung Chemical is expected to generate 0.53 times more return on investment than SKONEC Entertainment. However, Tae Kyung Chemical is 1.89 times less risky than SKONEC Entertainment. It trades about -0.04 of its potential returns per unit of risk. SKONEC Entertainment Co is currently generating about -0.07 per unit of risk. If you would invest 1,450,321 in Tae Kyung Chemical on September 12, 2024 and sell it today you would lose (408,321) from holding Tae Kyung Chemical or give up 28.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tae Kyung Chemical vs. SKONEC Entertainment Co
Performance |
| Timeline |
| Tae Kyung Chemical |
| SKONEC Entertainment |
Tae Kyung and SKONEC Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tae Kyung and SKONEC Entertainment
The main advantage of trading using opposite Tae Kyung and SKONEC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tae Kyung position performs unexpectedly, SKONEC Entertainment 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 SKONEC Entertainment will offset losses from the drop in SKONEC Entertainment's long position.| Tae Kyung vs. Samsung Electronics Co | Tae Kyung vs. Samsung Electronics Co | Tae Kyung vs. SK Hynix | Tae Kyung vs. POSCO Holdings |
| SKONEC Entertainment vs. Kakao Games Corp | SKONEC Entertainment vs. Devsisters corporation | SKONEC Entertainment vs. Konan Technology | SKONEC Entertainment vs. Nice Information Telecommunication |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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