Correlation Between Korea Shipbuilding and CKH Food
Can any of the company-specific risk be diversified away by investing in both Korea Shipbuilding and CKH Food 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 Korea Shipbuilding and CKH Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Shipbuilding Offshore and CKH Food Health, you can compare the effects of market volatilities on Korea Shipbuilding and CKH Food 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 Korea Shipbuilding with a short position of CKH Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Shipbuilding and CKH Food.
Diversification Opportunities for Korea Shipbuilding and CKH Food
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Korea and CKH is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Korea Shipbuilding Offshore and CKH Food Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CKH Food Health and Korea Shipbuilding 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 Korea Shipbuilding Offshore are associated (or correlated) with CKH Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CKH Food Health has no effect on the direction of Korea Shipbuilding i.e., Korea Shipbuilding and CKH Food go up and down completely randomly.
Pair Corralation between Korea Shipbuilding and CKH Food
Assuming the 90 days trading horizon Korea Shipbuilding Offshore is expected to generate 0.77 times more return on investment than CKH Food. However, Korea Shipbuilding Offshore is 1.3 times less risky than CKH Food. It trades about 0.1 of its potential returns per unit of risk. CKH Food Health is currently generating about -0.06 per unit of risk. If you would invest 7,380,000 in Korea Shipbuilding Offshore on August 25, 2024 and sell it today you would earn a total of 12,770,000 from holding Korea Shipbuilding Offshore or generate 173.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Korea Shipbuilding Offshore vs. CKH Food Health
Performance |
| Timeline |
| Korea Shipbuilding |
| CKH Food Health |
Korea Shipbuilding and CKH Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Shipbuilding and CKH Food
The main advantage of trading using opposite Korea Shipbuilding and CKH Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Shipbuilding position performs unexpectedly, CKH Food 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 CKH Food will offset losses from the drop in CKH Food's long position.| Korea Shipbuilding vs. Lotte Chilsung Beverage | Korea Shipbuilding vs. Hyundai Industrial Co | Korea Shipbuilding vs. Samhwa Paint Industrial | Korea Shipbuilding vs. Seoul Food Industrial |
| CKH Food vs. AptaBio Therapeutics | CKH Food vs. Daewoo SBI SPAC | CKH Food vs. Dream Security co | CKH Food vs. Microfriend |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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