Correlation Between Myoung Shin and Kukdong Oil
Can any of the company-specific risk be diversified away by investing in both Myoung Shin and Kukdong Oil 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 Myoung Shin and Kukdong Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Myoung Shin Industrial and Kukdong Oil Chemicals, you can compare the effects of market volatilities on Myoung Shin and Kukdong Oil 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 Myoung Shin with a short position of Kukdong Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Myoung Shin and Kukdong Oil.
Diversification Opportunities for Myoung Shin and Kukdong Oil
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Myoung and Kukdong is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Myoung Shin Industrial and Kukdong Oil Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukdong Oil Chemicals and Myoung Shin 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 Myoung Shin Industrial are associated (or correlated) with Kukdong Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukdong Oil Chemicals has no effect on the direction of Myoung Shin i.e., Myoung Shin and Kukdong Oil go up and down completely randomly.
Pair Corralation between Myoung Shin and Kukdong Oil
Assuming the 90 days trading horizon Myoung Shin Industrial is expected to under-perform the Kukdong Oil. In addition to that, Myoung Shin is 5.4 times more volatile than Kukdong Oil Chemicals. It trades about -0.16 of its total potential returns per unit of risk. Kukdong Oil Chemicals is currently generating about -0.23 per unit of volatility. If you would invest 372,000 in Kukdong Oil Chemicals on September 1, 2024 and sell it today you would lose (14,000) from holding Kukdong Oil Chemicals or give up 3.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Myoung Shin Industrial vs. Kukdong Oil Chemicals
Performance |
| Timeline |
| Myoung Shin Industrial |
| Kukdong Oil Chemicals |
Myoung Shin and Kukdong Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Myoung Shin and Kukdong Oil
The main advantage of trading using opposite Myoung Shin and Kukdong Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Myoung Shin position performs unexpectedly, Kukdong Oil 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 Kukdong Oil will offset losses from the drop in Kukdong Oil's long position.| Myoung Shin vs. KB Financial Group | Myoung Shin vs. Dongbang Ship Machinery | Myoung Shin vs. Busan Industrial Co | Myoung Shin vs. Busan Ind |
| Kukdong Oil vs. AptaBio Therapeutics | Kukdong Oil vs. Daewoo SBI SPAC | Kukdong Oil vs. Dream Security co | Kukdong Oil 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |