Correlation Between Kukdong Oil and Atinum Investment
Can any of the company-specific risk be diversified away by investing in both Kukdong Oil and Atinum Investment 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 Kukdong Oil and Atinum Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kukdong Oil Chemicals and Atinum Investment Co, you can compare the effects of market volatilities on Kukdong Oil and Atinum Investment 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 Kukdong Oil with a short position of Atinum Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukdong Oil and Atinum Investment.
Diversification Opportunities for Kukdong Oil and Atinum Investment
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kukdong and Atinum is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Kukdong Oil Chemicals and Atinum Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atinum Investment and Kukdong Oil 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 Kukdong Oil Chemicals are associated (or correlated) with Atinum Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atinum Investment has no effect on the direction of Kukdong Oil i.e., Kukdong Oil and Atinum Investment go up and down completely randomly.
Pair Corralation between Kukdong Oil and Atinum Investment
Assuming the 90 days trading horizon Kukdong Oil Chemicals is expected to generate 0.45 times more return on investment than Atinum Investment. However, Kukdong Oil Chemicals is 2.21 times less risky than Atinum Investment. It trades about 0.07 of its potential returns per unit of risk. Atinum Investment Co is currently generating about -0.03 per unit of risk. If you would invest 331,004 in Kukdong Oil Chemicals on November 1, 2024 and sell it today you would earn a total of 13,496 from holding Kukdong Oil Chemicals or generate 4.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukdong Oil Chemicals vs. Atinum Investment Co
Performance |
| Timeline |
| Kukdong Oil Chemicals |
| Atinum Investment |
Kukdong Oil and Atinum Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukdong Oil and Atinum Investment
The main advantage of trading using opposite Kukdong Oil and Atinum Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukdong Oil position performs unexpectedly, Atinum Investment 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 Atinum Investment will offset losses from the drop in Atinum Investment's long position.| Kukdong Oil vs. Samsung Publishing Co | Kukdong Oil vs. Lotte Non Life Insurance | Kukdong Oil vs. DB Insurance Co | Kukdong Oil vs. Hankuk Steel Wire |
| Atinum Investment vs. Hankook Furniture Co | Atinum Investment vs. Dgb Financial | Atinum Investment vs. LG Household Healthcare | Atinum Investment vs. Jb Financial |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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