Correlation Between Pureun Mutual and RF Materials
Can any of the company-specific risk be diversified away by investing in both Pureun Mutual and RF Materials 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 Pureun Mutual and RF Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pureun Mutual Savings and RF Materials Co, you can compare the effects of market volatilities on Pureun Mutual and RF Materials 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 Pureun Mutual with a short position of RF Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pureun Mutual and RF Materials.
Diversification Opportunities for Pureun Mutual and RF Materials
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pureun and 327260 is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Pureun Mutual Savings and RF Materials Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RF Materials and Pureun Mutual 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 Pureun Mutual Savings are associated (or correlated) with RF Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RF Materials has no effect on the direction of Pureun Mutual i.e., Pureun Mutual and RF Materials go up and down completely randomly.
Pair Corralation between Pureun Mutual and RF Materials
Assuming the 90 days trading horizon Pureun Mutual Savings is expected to generate 0.66 times more return on investment than RF Materials. However, Pureun Mutual Savings is 1.51 times less risky than RF Materials. It trades about -0.06 of its potential returns per unit of risk. RF Materials Co is currently generating about -0.04 per unit of risk. If you would invest 1,171,519 in Pureun Mutual Savings on November 3, 2024 and sell it today you would lose (354,519) from holding Pureun Mutual Savings or give up 30.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pureun Mutual Savings vs. RF Materials Co
Performance |
| Timeline |
| Pureun Mutual Savings |
| RF Materials |
Pureun Mutual and RF Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pureun Mutual and RF Materials
The main advantage of trading using opposite Pureun Mutual and RF Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pureun Mutual position performs unexpectedly, RF Materials 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 RF Materials will offset losses from the drop in RF Materials' long position.| Pureun Mutual vs. Histeel | Pureun Mutual vs. Fine Besteel Co | Pureun Mutual vs. SH Energy Chemical | Pureun Mutual vs. Insun Environment New |
| RF Materials vs. Dongbang Transport Logistics | RF Materials vs. Lotte Data Communication | RF Materials vs. DB Insurance Co | RF Materials vs. Inzi Display CoLtd |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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