Correlation Between Moonbae Steel and KT Hitel
Can any of the company-specific risk be diversified away by investing in both Moonbae Steel and KT Hitel 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 Moonbae Steel and KT Hitel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moonbae Steel and KT Hitel, you can compare the effects of market volatilities on Moonbae Steel and KT Hitel 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 Moonbae Steel with a short position of KT Hitel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moonbae Steel and KT Hitel.
Diversification Opportunities for Moonbae Steel and KT Hitel
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Moonbae and 036030 is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Moonbae Steel and KT Hitel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Hitel and Moonbae Steel 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 Moonbae Steel are associated (or correlated) with KT Hitel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Hitel has no effect on the direction of Moonbae Steel i.e., Moonbae Steel and KT Hitel go up and down completely randomly.
Pair Corralation between Moonbae Steel and KT Hitel
Assuming the 90 days trading horizon Moonbae Steel is expected to generate 0.83 times more return on investment than KT Hitel. However, Moonbae Steel is 1.21 times less risky than KT Hitel. It trades about -0.04 of its potential returns per unit of risk. KT Hitel is currently generating about -0.05 per unit of risk. If you would invest 342,405 in Moonbae Steel on October 29, 2024 and sell it today you would lose (114,405) from holding Moonbae Steel or give up 33.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Moonbae Steel vs. KT Hitel
Performance |
| Timeline |
| Moonbae Steel |
| KT Hitel |
Moonbae Steel and KT Hitel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Moonbae Steel and KT Hitel
The main advantage of trading using opposite Moonbae Steel and KT Hitel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moonbae Steel position performs unexpectedly, KT Hitel 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 KT Hitel will offset losses from the drop in KT Hitel's long position.| Moonbae Steel vs. Iljin Display | Moonbae Steel vs. Incar Financial Service | Moonbae Steel vs. KakaoBank Corp | Moonbae Steel vs. Lotte Data Communication |
| KT Hitel vs. Woori Financial Group | KT Hitel vs. Lion Chemtech Co | KT Hitel vs. Hana Financial | KT Hitel vs. Incar Financial Service |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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