Correlation Between Youngbo Chemical and Jeong Moon
Can any of the company-specific risk be diversified away by investing in both Youngbo Chemical and Jeong Moon 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 Youngbo Chemical and Jeong Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngbo Chemical Co and Jeong Moon Information, you can compare the effects of market volatilities on Youngbo Chemical and Jeong Moon 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 Youngbo Chemical with a short position of Jeong Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngbo Chemical and Jeong Moon.
Diversification Opportunities for Youngbo Chemical and Jeong Moon
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Youngbo and Jeong is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Youngbo Chemical Co and Jeong Moon Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeong Moon Information and Youngbo Chemical 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 Youngbo Chemical Co are associated (or correlated) with Jeong Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeong Moon Information has no effect on the direction of Youngbo Chemical i.e., Youngbo Chemical and Jeong Moon go up and down completely randomly.
Pair Corralation between Youngbo Chemical and Jeong Moon
Assuming the 90 days trading horizon Youngbo Chemical Co is expected to generate 1.45 times more return on investment than Jeong Moon. However, Youngbo Chemical is 1.45 times more volatile than Jeong Moon Information. It trades about 0.37 of its potential returns per unit of risk. Jeong Moon Information is currently generating about 0.17 per unit of risk. If you would invest 369,500 in Youngbo Chemical Co on November 8, 2024 and sell it today you would earn a total of 58,000 from holding Youngbo Chemical Co or generate 15.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngbo Chemical Co vs. Jeong Moon Information
Performance |
| Timeline |
| Youngbo Chemical |
| Jeong Moon Information |
Youngbo Chemical and Jeong Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngbo Chemical and Jeong Moon
The main advantage of trading using opposite Youngbo Chemical and Jeong Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngbo Chemical position performs unexpectedly, Jeong Moon 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 Jeong Moon will offset losses from the drop in Jeong Moon's long position.| Youngbo Chemical vs. Dongwoon Anatech Co | Youngbo Chemical vs. Polaris Office Corp | Youngbo Chemical vs. Barunson Entertainment Arts | Youngbo Chemical vs. Samick Musical Instruments |
| Jeong Moon vs. KMH Hitech Co | Jeong Moon vs. SEOWONINTECHCoLtd | Jeong Moon vs. Yura Tech Co | Jeong Moon vs. Next Entertainment World |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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