Correlation Between Bosung Power and Kyung In
Can any of the company-specific risk be diversified away by investing in both Bosung Power and Kyung In 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 Bosung Power and Kyung In into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bosung Power Technology and Kyung In Synthetic Corp, you can compare the effects of market volatilities on Bosung Power and Kyung In 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 Bosung Power with a short position of Kyung In. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bosung Power and Kyung In.
Diversification Opportunities for Bosung Power and Kyung In
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bosung and Kyung is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Bosung Power Technology and Kyung In Synthetic Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kyung In Synthetic and Bosung Power 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 Bosung Power Technology are associated (or correlated) with Kyung In. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kyung In Synthetic has no effect on the direction of Bosung Power i.e., Bosung Power and Kyung In go up and down completely randomly.
Pair Corralation between Bosung Power and Kyung In
Assuming the 90 days trading horizon Bosung Power Technology is expected to generate 1.56 times more return on investment than Kyung In. However, Bosung Power is 1.56 times more volatile than Kyung In Synthetic Corp. It trades about -0.02 of its potential returns per unit of risk. Kyung In Synthetic Corp is currently generating about -0.03 per unit of risk. If you would invest 420,000 in Bosung Power Technology on October 13, 2024 and sell it today you would lose (150,000) from holding Bosung Power Technology or give up 35.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bosung Power Technology vs. Kyung In Synthetic Corp
Performance |
| Timeline |
| Bosung Power Technology |
| Kyung In Synthetic |
Bosung Power and Kyung In Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bosung Power and Kyung In
The main advantage of trading using opposite Bosung Power and Kyung In positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bosung Power position performs unexpectedly, Kyung In 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 Kyung In will offset losses from the drop in Kyung In's long position.| Bosung Power vs. Jin Air Co | Bosung Power vs. Hanwha Chemical Corp | Bosung Power vs. Kakao Games Corp | Bosung Power vs. Jeju Air Co |
| Kyung In vs. Bosung Power Technology | Kyung In vs. Seoam Machinery Industry | Kyung In vs. Camus Engineering Construction | Kyung In vs. Hwangkum Steel Technology |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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