Correlation Between Youngsin Metal and Heungkuk Metaltech
Can any of the company-specific risk be diversified away by investing in both Youngsin Metal and Heungkuk Metaltech 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 Heungkuk Metaltech 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 Heungkuk Metaltech CoLtd, you can compare the effects of market volatilities on Youngsin Metal and Heungkuk Metaltech 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 Heungkuk Metaltech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngsin Metal and Heungkuk Metaltech.
Diversification Opportunities for Youngsin Metal and Heungkuk Metaltech
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Youngsin and Heungkuk is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Youngsin Metal Industrial and Heungkuk Metaltech CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heungkuk Metaltech CoLtd 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 Heungkuk Metaltech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heungkuk Metaltech CoLtd has no effect on the direction of Youngsin Metal i.e., Youngsin Metal and Heungkuk Metaltech go up and down completely randomly.
Pair Corralation between Youngsin Metal and Heungkuk Metaltech
Assuming the 90 days trading horizon Youngsin Metal Industrial is expected to under-perform the Heungkuk Metaltech. In addition to that, Youngsin Metal is 1.11 times more volatile than Heungkuk Metaltech CoLtd. It trades about -0.24 of its total potential returns per unit of risk. Heungkuk Metaltech CoLtd is currently generating about -0.16 per unit of volatility. If you would invest 540,000 in Heungkuk Metaltech CoLtd on November 2, 2024 and sell it today you would lose (21,000) from holding Heungkuk Metaltech CoLtd or give up 3.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngsin Metal Industrial vs. Heungkuk Metaltech CoLtd
Performance |
| Timeline |
| Youngsin Metal Industrial |
| Heungkuk Metaltech CoLtd |
Youngsin Metal and Heungkuk Metaltech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngsin Metal and Heungkuk Metaltech
The main advantage of trading using opposite Youngsin Metal and Heungkuk Metaltech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngsin Metal position performs unexpectedly, Heungkuk Metaltech 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 Heungkuk Metaltech will offset losses from the drop in Heungkuk Metaltech's long position.| Youngsin Metal vs. Nice Information Telecommunication | Youngsin Metal vs. LG Household Healthcare | Youngsin Metal vs. Digital Power Communications | Youngsin Metal vs. INFINITT Healthcare Co |
| Heungkuk Metaltech vs. Dongil Metal Co | Heungkuk Metaltech vs. Solution Advanced Technology | Heungkuk Metaltech vs. Global Standard Technology | Heungkuk Metaltech vs. Puloon 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 Directory module to find actively traded commodities issued by global exchanges.
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