Correlation Between Youngsin Metal and Korea New
Can any of the company-specific risk be diversified away by investing in both Youngsin Metal and Korea New 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 Korea New 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 Korea New Network, you can compare the effects of market volatilities on Youngsin Metal and Korea New 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 Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngsin Metal and Korea New.
Diversification Opportunities for Youngsin Metal and Korea New
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Youngsin and Korea is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Youngsin Metal Industrial and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network 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 Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of Youngsin Metal i.e., Youngsin Metal and Korea New go up and down completely randomly.
Pair Corralation between Youngsin Metal and Korea New
Assuming the 90 days trading horizon Youngsin Metal Industrial is expected to under-perform the Korea New. In addition to that, Youngsin Metal is 1.23 times more volatile than Korea New Network. It trades about -0.28 of its total potential returns per unit of risk. Korea New Network is currently generating about -0.07 per unit of volatility. If you would invest 81,000 in Korea New Network on November 3, 2024 and sell it today you would lose (1,400) from holding Korea New Network or give up 1.73% 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. Korea New Network
Performance |
| Timeline |
| Youngsin Metal Industrial |
| Korea New Network |
Youngsin Metal and Korea New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngsin Metal and Korea New
The main advantage of trading using opposite Youngsin Metal and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngsin Metal position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New's long position.| Youngsin Metal vs. RFTech Co | Youngsin Metal vs. ADTechnology CoLtd | Youngsin Metal vs. Handok Clean Tech | Youngsin Metal vs. CG Hi Tech |
| Korea New vs. Barunson Entertainment Arts | Korea New vs. Shinhan Inverse Silver | Korea New vs. FOODWELL Co | Korea New vs. Haitai Confectionery Foods |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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