Correlation Between Wonil Special and Pan Entertainment
Can any of the company-specific risk be diversified away by investing in both Wonil Special and Pan Entertainment 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 Wonil Special and Pan Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wonil Special Steel and Pan Entertainment Co, you can compare the effects of market volatilities on Wonil Special and Pan Entertainment 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 Wonil Special with a short position of Pan Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonil Special and Pan Entertainment.
Diversification Opportunities for Wonil Special and Pan Entertainment
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wonil and Pan is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Wonil Special Steel and Pan Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan Entertainment and Wonil Special 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 Wonil Special Steel are associated (or correlated) with Pan Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan Entertainment has no effect on the direction of Wonil Special i.e., Wonil Special and Pan Entertainment go up and down completely randomly.
Pair Corralation between Wonil Special and Pan Entertainment
Assuming the 90 days trading horizon Wonil Special Steel is expected to generate 0.77 times more return on investment than Pan Entertainment. However, Wonil Special Steel is 1.3 times less risky than Pan Entertainment. It trades about 0.12 of its potential returns per unit of risk. Pan Entertainment Co is currently generating about 0.09 per unit of risk. If you would invest 706,000 in Wonil Special Steel on August 31, 2024 and sell it today you would earn a total of 22,000 from holding Wonil Special Steel or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wonil Special Steel vs. Pan Entertainment Co
Performance |
| Timeline |
| Wonil Special Steel |
| Pan Entertainment |
Wonil Special and Pan Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonil Special and Pan Entertainment
The main advantage of trading using opposite Wonil Special and Pan Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonil Special position performs unexpectedly, Pan Entertainment 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 Pan Entertainment will offset losses from the drop in Pan Entertainment's long position.| Wonil Special vs. LG Chemicals | Wonil Special vs. POSCO Holdings | Wonil Special vs. Hanwha Solutions | Wonil Special vs. Lotte Chemical Corp |
| Pan Entertainment vs. Mgame Corp | Pan Entertainment vs. Sewoon Medical Co | Pan Entertainment vs. ENERGYMACHINERY KOREA CoLtd | Pan Entertainment vs. Korean Drug 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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