Correlation Between Youngsin Metal and Korean Air
Can any of the company-specific risk be diversified away by investing in both Youngsin Metal and Korean Air 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 Youngsin Metal and Korean Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngsin Metal Industrial and Korean Air Lines, you can compare the effects of market volatilities on Youngsin Metal and Korean Air 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 Youngsin Metal with a short position of Korean Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngsin Metal and Korean Air.
Diversification Opportunities for Youngsin Metal and Korean Air
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Youngsin and Korean is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Youngsin Metal Industrial and Korean Air Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korean Air Lines and Youngsin Metal 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 Youngsin Metal Industrial are associated (or correlated) with Korean Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korean Air Lines has no effect on the direction of Youngsin Metal i.e., Youngsin Metal and Korean Air go up and down completely randomly.
Pair Corralation between Youngsin Metal and Korean Air
Assuming the 90 days trading horizon Youngsin Metal Industrial is expected to generate 2.39 times more return on investment than Korean Air. However, Youngsin Metal is 2.39 times more volatile than Korean Air Lines. It trades about 0.0 of its potential returns per unit of risk. Korean Air Lines is currently generating about -0.05 per unit of risk. If you would invest 273,500 in Youngsin Metal Industrial on September 26, 2024 and sell it today you would lose (33,000) from holding Youngsin Metal Industrial or give up 12.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Youngsin Metal Industrial vs. Korean Air Lines
Performance |
| Timeline |
| Youngsin Metal Industrial |
| Korean Air Lines |
Youngsin Metal and Korean Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngsin Metal and Korean Air
The main advantage of trading using opposite Youngsin Metal and Korean Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngsin Metal position performs unexpectedly, Korean Air 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 Korean Air will offset losses from the drop in Korean Air's long position.| Youngsin Metal vs. Busan Industrial Co | Youngsin Metal vs. Busan Ind | Youngsin Metal vs. Mirae Asset Daewoo | Youngsin Metal vs. Shinhan WTI Futures |
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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