Correlation Between LEADCORP and NHN KCP
Can any of the company-specific risk be diversified away by investing in both LEADCORP and NHN KCP 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 LEADCORP and NHN KCP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The LEADCORP and NHN KCP Corp, you can compare the effects of market volatilities on LEADCORP and NHN KCP 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 LEADCORP with a short position of NHN KCP. Check out your portfolio center. Please also check ongoing floating volatility patterns of LEADCORP and NHN KCP.
Diversification Opportunities for LEADCORP and NHN KCP
Very weak diversification
The 3 months correlation between LEADCORP and NHN is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding The LEADCORP and NHN KCP Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NHN KCP Corp and LEADCORP 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 The LEADCORP are associated (or correlated) with NHN KCP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NHN KCP Corp has no effect on the direction of LEADCORP i.e., LEADCORP and NHN KCP go up and down completely randomly.
Pair Corralation between LEADCORP and NHN KCP
Assuming the 90 days trading horizon The LEADCORP is expected to under-perform the NHN KCP. But the stock apears to be less risky and, when comparing its historical volatility, The LEADCORP is 2.52 times less risky than NHN KCP. The stock trades about -0.05 of its potential returns per unit of risk. The NHN KCP Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 903,203 in NHN KCP Corp on September 1, 2024 and sell it today you would lose (127,203) from holding NHN KCP Corp or give up 14.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.62% |
| Values | Daily Returns |
The LEADCORP vs. NHN KCP Corp
Performance |
| Timeline |
| LEADCORP |
| NHN KCP Corp |
LEADCORP and NHN KCP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LEADCORP and NHN KCP
The main advantage of trading using opposite LEADCORP and NHN KCP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LEADCORP position performs unexpectedly, NHN KCP 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 NHN KCP will offset losses from the drop in NHN KCP's long position.| LEADCORP vs. Nice Information Telecommunication | LEADCORP vs. HB Technology TD | LEADCORP vs. Daou Technology | LEADCORP vs. Konan Technology |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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