Correlation Between Anam Electronics and Neungyule Education
Can any of the company-specific risk be diversified away by investing in both Anam Electronics and Neungyule Education 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 Anam Electronics and Neungyule Education into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anam Electronics Co and Neungyule Education, you can compare the effects of market volatilities on Anam Electronics and Neungyule Education 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 Anam Electronics with a short position of Neungyule Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anam Electronics and Neungyule Education.
Diversification Opportunities for Anam Electronics and Neungyule Education
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anam and Neungyule is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Anam Electronics Co and Neungyule Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neungyule Education and Anam Electronics 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 Anam Electronics Co are associated (or correlated) with Neungyule Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neungyule Education has no effect on the direction of Anam Electronics i.e., Anam Electronics and Neungyule Education go up and down completely randomly.
Pair Corralation between Anam Electronics and Neungyule Education
Assuming the 90 days trading horizon Anam Electronics Co is expected to under-perform the Neungyule Education. But the stock apears to be less risky and, when comparing its historical volatility, Anam Electronics Co is 1.79 times less risky than Neungyule Education. The stock trades about -0.15 of its potential returns per unit of risk. The Neungyule Education is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 446,500 in Neungyule Education on August 25, 2024 and sell it today you would lose (98,000) from holding Neungyule Education or give up 21.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anam Electronics Co vs. Neungyule Education
Performance |
| Timeline |
| Anam Electronics |
| Neungyule Education |
Anam Electronics and Neungyule Education Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anam Electronics and Neungyule Education
The main advantage of trading using opposite Anam Electronics and Neungyule Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anam Electronics position performs unexpectedly, Neungyule Education 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 Neungyule Education will offset losses from the drop in Neungyule Education's long position.| Anam Electronics vs. Neungyule Education | Anam Electronics vs. Bohae Brewery | Anam Electronics vs. Pan Entertainment Co | Anam Electronics vs. Daewon Media Co |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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