Correlation Between KyungIn Electronics and Eugene Investment
Can any of the company-specific risk be diversified away by investing in both KyungIn Electronics and Eugene Investment 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 KyungIn Electronics and Eugene Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KyungIn Electronics Co and Eugene Investment Securities, you can compare the effects of market volatilities on KyungIn Electronics and Eugene Investment 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 KyungIn Electronics with a short position of Eugene Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of KyungIn Electronics and Eugene Investment.
Diversification Opportunities for KyungIn Electronics and Eugene Investment
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KyungIn and Eugene is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding KyungIn Electronics Co and Eugene Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eugene Investment and KyungIn 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 KyungIn Electronics Co are associated (or correlated) with Eugene Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eugene Investment has no effect on the direction of KyungIn Electronics i.e., KyungIn Electronics and Eugene Investment go up and down completely randomly.
Pair Corralation between KyungIn Electronics and Eugene Investment
Assuming the 90 days trading horizon KyungIn Electronics is expected to generate 4.1 times less return on investment than Eugene Investment. But when comparing it to its historical volatility, KyungIn Electronics Co is 1.11 times less risky than Eugene Investment. It trades about 0.01 of its potential returns per unit of risk. Eugene Investment Securities is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 230,529 in Eugene Investment Securities on September 19, 2024 and sell it today you would earn a total of 34,471 from holding Eugene Investment Securities or generate 14.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KyungIn Electronics Co vs. Eugene Investment Securities
Performance |
| Timeline |
| KyungIn Electronics |
| Eugene Investment |
KyungIn Electronics and Eugene Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KyungIn Electronics and Eugene Investment
The main advantage of trading using opposite KyungIn Electronics and Eugene Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KyungIn Electronics position performs unexpectedly, Eugene Investment 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 Eugene Investment will offset losses from the drop in Eugene Investment's long position.| KyungIn Electronics vs. Samsung Electronics Co | KyungIn Electronics vs. Samsung Electronics Co | KyungIn Electronics vs. SK Hynix | KyungIn Electronics vs. POSCO Holdings |
| Eugene Investment vs. KyungIn Electronics Co | Eugene Investment vs. Sungwoo Electronics Co | Eugene Investment vs. DAEDUCK ELECTRONICS CoLtd | Eugene Investment vs. Lotte Chilsung Beverage |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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