Correlation Between Camus Engineering and Korea Shipbuilding
Can any of the company-specific risk be diversified away by investing in both Camus Engineering and Korea Shipbuilding 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 Camus Engineering and Korea Shipbuilding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camus Engineering Construction and Korea Shipbuilding Offshore, you can compare the effects of market volatilities on Camus Engineering and Korea Shipbuilding 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 Camus Engineering with a short position of Korea Shipbuilding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camus Engineering and Korea Shipbuilding.
Diversification Opportunities for Camus Engineering and Korea Shipbuilding
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Camus and Korea is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Camus Engineering Construction and Korea Shipbuilding Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Shipbuilding and Camus Engineering 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 Camus Engineering Construction are associated (or correlated) with Korea Shipbuilding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Shipbuilding has no effect on the direction of Camus Engineering i.e., Camus Engineering and Korea Shipbuilding go up and down completely randomly.
Pair Corralation between Camus Engineering and Korea Shipbuilding
Assuming the 90 days trading horizon Camus Engineering Construction is expected to generate 2.73 times more return on investment than Korea Shipbuilding. However, Camus Engineering is 2.73 times more volatile than Korea Shipbuilding Offshore. It trades about 0.2 of its potential returns per unit of risk. Korea Shipbuilding Offshore is currently generating about 0.27 per unit of risk. If you would invest 135,000 in Camus Engineering Construction on October 12, 2024 and sell it today you would earn a total of 36,300 from holding Camus Engineering Construction or generate 26.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Camus Engineering Construction vs. Korea Shipbuilding Offshore
Performance |
| Timeline |
| Camus Engineering |
| Korea Shipbuilding |
Camus Engineering and Korea Shipbuilding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camus Engineering and Korea Shipbuilding
The main advantage of trading using opposite Camus Engineering and Korea Shipbuilding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camus Engineering position performs unexpectedly, Korea Shipbuilding 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 Shipbuilding will offset losses from the drop in Korea Shipbuilding's long position.| Camus Engineering vs. DC Media Co | Camus Engineering vs. ChipsMedia | Camus Engineering vs. MediaZen | Camus Engineering vs. SAMG Entertainment Co |
| Korea Shipbuilding vs. ENERGYMACHINERY KOREA CoLtd | Korea Shipbuilding vs. Daewoo Engineering Construction | Korea Shipbuilding vs. Alton Sports CoLtd | Korea Shipbuilding vs. Camus Engineering Construction |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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