Correlation Between Keyang Electric and CJ Seafood
Can any of the company-specific risk be diversified away by investing in both Keyang Electric and CJ Seafood 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 Keyang Electric and CJ Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keyang Electric Machinery and CJ Seafood Corp, you can compare the effects of market volatilities on Keyang Electric and CJ Seafood 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 Keyang Electric with a short position of CJ Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keyang Electric and CJ Seafood.
Diversification Opportunities for Keyang Electric and CJ Seafood
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Keyang and 011150 is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Keyang Electric Machinery and CJ Seafood Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CJ Seafood Corp and Keyang Electric 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 Keyang Electric Machinery are associated (or correlated) with CJ Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CJ Seafood Corp has no effect on the direction of Keyang Electric i.e., Keyang Electric and CJ Seafood go up and down completely randomly.
Pair Corralation between Keyang Electric and CJ Seafood
Assuming the 90 days trading horizon Keyang Electric Machinery is expected to generate 0.79 times more return on investment than CJ Seafood. However, Keyang Electric Machinery is 1.26 times less risky than CJ Seafood. It trades about 0.13 of its potential returns per unit of risk. CJ Seafood Corp is currently generating about -0.09 per unit of risk. If you would invest 359,500 in Keyang Electric Machinery on October 27, 2024 and sell it today you would earn a total of 20,000 from holding Keyang Electric Machinery or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keyang Electric Machinery vs. CJ Seafood Corp
Performance |
| Timeline |
| Keyang Electric Machinery |
| CJ Seafood Corp |
Keyang Electric and CJ Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keyang Electric and CJ Seafood
The main advantage of trading using opposite Keyang Electric and CJ Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keyang Electric position performs unexpectedly, CJ Seafood 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 CJ Seafood will offset losses from the drop in CJ Seafood's long position.| Keyang Electric vs. Daejung Chemicals Metals | Keyang Electric vs. Adaptive Plasma Technology | Keyang Electric vs. Ilji Technology Co | Keyang Electric vs. Solution Advanced Technology |
| CJ Seafood vs. KB Financial Group | CJ Seafood vs. Shinhan Financial Group | CJ Seafood vs. Hana Financial | CJ Seafood vs. Woori Financial Group |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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