Correlation Between KyungIn Electronics and Korea Information
Can any of the company-specific risk be diversified away by investing in both KyungIn Electronics and Korea Information 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 Korea Information 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 Korea Information Communications, you can compare the effects of market volatilities on KyungIn Electronics and Korea Information 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 Korea Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of KyungIn Electronics and Korea Information.
Diversification Opportunities for KyungIn Electronics and Korea Information
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between KyungIn and Korea is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding KyungIn Electronics Co and Korea Information Communicatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Information 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 Korea Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Information has no effect on the direction of KyungIn Electronics i.e., KyungIn Electronics and Korea Information go up and down completely randomly.
Pair Corralation between KyungIn Electronics and Korea Information
Assuming the 90 days trading horizon KyungIn Electronics Co is expected to under-perform the Korea Information. But the stock apears to be less risky and, when comparing its historical volatility, KyungIn Electronics Co is 1.21 times less risky than Korea Information. The stock trades about -0.17 of its potential returns per unit of risk. The Korea Information Communications is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 800,000 in Korea Information Communications on November 27, 2024 and sell it today you would lose (15,000) from holding Korea Information Communications or give up 1.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KyungIn Electronics Co vs. Korea Information Communicatio
Performance |
| Timeline |
| KyungIn Electronics |
| Korea Information |
KyungIn Electronics and Korea Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KyungIn Electronics and Korea Information
The main advantage of trading using opposite KyungIn Electronics and Korea Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KyungIn Electronics position performs unexpectedly, Korea Information 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 Information will offset losses from the drop in Korea Information's long position.| KyungIn Electronics vs. Innowireless Co | KyungIn Electronics vs. ITM Semiconductor Co | KyungIn Electronics vs. Mgame Corp | KyungIn Electronics vs. Daishin Information Communications |
| Korea Information vs. Pan Entertainment Co | Korea Information vs. YG Entertainment | Korea Information vs. FNC Entertainment Co | Korea Information vs. Youngsin Metal Industrial |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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