Correlation Between Kukdong Oil and Koryo Credit
Can any of the company-specific risk be diversified away by investing in both Kukdong Oil and Koryo Credit 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 Koryo Credit 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 Koryo Credit Information, you can compare the effects of market volatilities on Kukdong Oil and Koryo Credit 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 Koryo Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukdong Oil and Koryo Credit.
Diversification Opportunities for Kukdong Oil and Koryo Credit
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kukdong and Koryo is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Kukdong Oil Chemicals and Koryo Credit Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koryo Credit Information 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 Koryo Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koryo Credit Information has no effect on the direction of Kukdong Oil i.e., Kukdong Oil and Koryo Credit go up and down completely randomly.
Pair Corralation between Kukdong Oil and Koryo Credit
Assuming the 90 days trading horizon Kukdong Oil Chemicals is expected to under-perform the Koryo Credit. But the stock apears to be less risky and, when comparing its historical volatility, Kukdong Oil Chemicals is 1.65 times less risky than Koryo Credit. The stock trades about -0.2 of its potential returns per unit of risk. The Koryo Credit Information is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 996,000 in Koryo Credit Information on August 25, 2024 and sell it today you would lose (3,000) from holding Koryo Credit Information or give up 0.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukdong Oil Chemicals vs. Koryo Credit Information
Performance |
| Timeline |
| Kukdong Oil Chemicals |
| Koryo Credit Information |
Kukdong Oil and Koryo Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukdong Oil and Koryo Credit
The main advantage of trading using opposite Kukdong Oil and Koryo Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukdong Oil position performs unexpectedly, Koryo Credit 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 Koryo Credit will offset losses from the drop in Koryo Credit's long position.| Kukdong Oil vs. AptaBio Therapeutics | Kukdong Oil vs. Daewoo SBI SPAC | Kukdong Oil vs. Dream Security co | Kukdong Oil vs. Microfriend |
| Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. Hyundai Motor Co | Koryo Credit vs. Hyundai Motor |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |