Correlation Between Kyung In and Korea Industrial
Can any of the company-specific risk be diversified away by investing in both Kyung In and Korea Industrial 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 Kyung In and Korea Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kyung In Synthetic Corp and Korea Industrial Co, you can compare the effects of market volatilities on Kyung In and Korea Industrial 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 Kyung In with a short position of Korea Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyung In and Korea Industrial.
Diversification Opportunities for Kyung In and Korea Industrial
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kyung and Korea is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Kyung In Synthetic Corp and Korea Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Industrial and Kyung In 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 Kyung In Synthetic Corp are associated (or correlated) with Korea Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Industrial has no effect on the direction of Kyung In i.e., Kyung In and Korea Industrial go up and down completely randomly.
Pair Corralation between Kyung In and Korea Industrial
Assuming the 90 days trading horizon Kyung In Synthetic Corp is expected to under-perform the Korea Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Kyung In Synthetic Corp is 1.48 times less risky than Korea Industrial. The stock trades about -0.07 of its potential returns per unit of risk. The Korea Industrial Co is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 271,000 in Korea Industrial Co on November 7, 2024 and sell it today you would earn a total of 26,000 from holding Korea Industrial Co or generate 9.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kyung In Synthetic Corp vs. Korea Industrial Co
Performance |
| Timeline |
| Kyung In Synthetic |
| Korea Industrial |
Kyung In and Korea Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kyung In and Korea Industrial
The main advantage of trading using opposite Kyung In and Korea Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyung In position performs unexpectedly, Korea Industrial 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 Korea Industrial will offset losses from the drop in Korea Industrial's long position.| Kyung In vs. AptaBio Therapeutics | Kyung In vs. Daewoo SBI SPAC | Kyung In vs. Dream Security co | Kyung In vs. Microfriend |
| Korea Industrial vs. AptaBio Therapeutics | Korea Industrial vs. Daewoo SBI SPAC | Korea Industrial vs. Dream Security co | Korea Industrial 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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