Correlation Between Heungkuk Metaltech and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both Heungkuk Metaltech and Kukil Metal 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 Heungkuk Metaltech and Kukil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heungkuk Metaltech CoLtd and Kukil Metal Co, you can compare the effects of market volatilities on Heungkuk Metaltech and Kukil Metal 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 Heungkuk Metaltech with a short position of Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heungkuk Metaltech and Kukil Metal.
Diversification Opportunities for Heungkuk Metaltech and Kukil Metal
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Heungkuk and Kukil is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Heungkuk Metaltech CoLtd and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal and Heungkuk Metaltech 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 Heungkuk Metaltech CoLtd are associated (or correlated) with Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of Heungkuk Metaltech i.e., Heungkuk Metaltech and Kukil Metal go up and down completely randomly.
Pair Corralation between Heungkuk Metaltech and Kukil Metal
Assuming the 90 days trading horizon Heungkuk Metaltech CoLtd is expected to generate 0.65 times more return on investment than Kukil Metal. However, Heungkuk Metaltech CoLtd is 1.53 times less risky than Kukil Metal. It trades about 0.0 of its potential returns per unit of risk. Kukil Metal Co is currently generating about -0.04 per unit of risk. If you would invest 538,433 in Heungkuk Metaltech CoLtd on November 3, 2024 and sell it today you would lose (19,433) from holding Heungkuk Metaltech CoLtd or give up 3.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heungkuk Metaltech CoLtd vs. Kukil Metal Co
Performance |
| Timeline |
| Heungkuk Metaltech CoLtd |
| Kukil Metal |
Heungkuk Metaltech and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heungkuk Metaltech and Kukil Metal
The main advantage of trading using opposite Heungkuk Metaltech and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heungkuk Metaltech position performs unexpectedly, Kukil Metal 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| Heungkuk Metaltech vs. Hanwha Life Insurance | Heungkuk Metaltech vs. Dongbang Transport Logistics | Heungkuk Metaltech vs. Haitai Confectionery Foods | Heungkuk Metaltech vs. CJ Seafood Corp |
| Kukil Metal vs. KG Eco Technology | Kukil Metal vs. iNtRON Biotechnology | Kukil Metal vs. GS Retail Co | Kukil Metal vs. Ilji Technology 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 Transaction History module to view history of all your transactions and understand their impact on performance.
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