Correlation Between KyungIn Electronics and InfoBank
Can any of the company-specific risk be diversified away by investing in both KyungIn Electronics and InfoBank 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 InfoBank 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 InfoBank, you can compare the effects of market volatilities on KyungIn Electronics and InfoBank 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 InfoBank. Check out your portfolio center. Please also check ongoing floating volatility patterns of KyungIn Electronics and InfoBank.
Diversification Opportunities for KyungIn Electronics and InfoBank
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KyungIn and InfoBank is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding KyungIn Electronics Co and InfoBank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InfoBank 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 InfoBank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InfoBank has no effect on the direction of KyungIn Electronics i.e., KyungIn Electronics and InfoBank go up and down completely randomly.
Pair Corralation between KyungIn Electronics and InfoBank
Assuming the 90 days trading horizon KyungIn Electronics Co is expected to under-perform the InfoBank. But the stock apears to be less risky and, when comparing its historical volatility, KyungIn Electronics Co is 2.59 times less risky than InfoBank. The stock trades about -0.03 of its potential returns per unit of risk. The InfoBank is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 882,008 in InfoBank on October 13, 2024 and sell it today you would lose (103,008) from holding InfoBank or give up 11.68% 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. InfoBank
Performance |
| Timeline |
| KyungIn Electronics |
| InfoBank |
KyungIn Electronics and InfoBank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KyungIn Electronics and InfoBank
The main advantage of trading using opposite KyungIn Electronics and InfoBank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KyungIn Electronics position performs unexpectedly, InfoBank 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 InfoBank will offset losses from the drop in InfoBank's long position.| KyungIn Electronics vs. BIT Computer Co | KyungIn Electronics vs. Okins Electronics Co | KyungIn Electronics vs. Seers Technology | KyungIn Electronics vs. Guyoung Technology Co |
| InfoBank vs. Korea Information Communications | InfoBank vs. KyungIn Electronics Co | InfoBank vs. ABCO Electronics Co | InfoBank vs. Samsung Electronics Co |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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