Correlation Between Kukdong Oil and Youngchang Chemical
Can any of the company-specific risk be diversified away by investing in both Kukdong Oil and Youngchang Chemical 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 Youngchang Chemical 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 Youngchang Chemical Co, you can compare the effects of market volatilities on Kukdong Oil and Youngchang Chemical 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 Youngchang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukdong Oil and Youngchang Chemical.
Diversification Opportunities for Kukdong Oil and Youngchang Chemical
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kukdong and Youngchang is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Kukdong Oil Chemicals and Youngchang Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngchang Chemical 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 Youngchang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youngchang Chemical has no effect on the direction of Kukdong Oil i.e., Kukdong Oil and Youngchang Chemical go up and down completely randomly.
Pair Corralation between Kukdong Oil and Youngchang Chemical
Assuming the 90 days trading horizon Kukdong Oil Chemicals is expected to generate 0.23 times more return on investment than Youngchang Chemical. However, Kukdong Oil Chemicals is 4.32 times less risky than Youngchang Chemical. It trades about -0.14 of its potential returns per unit of risk. Youngchang Chemical Co is currently generating about -0.26 per unit of risk. If you would invest 371,000 in Kukdong Oil Chemicals on August 29, 2024 and sell it today you would lose (8,500) from holding Kukdong Oil Chemicals or give up 2.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukdong Oil Chemicals vs. Youngchang Chemical Co
Performance |
| Timeline |
| Kukdong Oil Chemicals |
| Youngchang Chemical |
Kukdong Oil and Youngchang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukdong Oil and Youngchang Chemical
The main advantage of trading using opposite Kukdong Oil and Youngchang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukdong Oil position performs unexpectedly, Youngchang Chemical 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 Youngchang Chemical will offset losses from the drop in Youngchang Chemical's long position.| Kukdong Oil vs. AptaBio Therapeutics | Kukdong Oil vs. Daewoo SBI SPAC | Kukdong Oil vs. Dream Security co | Kukdong Oil vs. Microfriend |
| Youngchang Chemical vs. Dongbu Steel Co | Youngchang Chemical vs. J Steel Co | Youngchang Chemical vs. Ni Steel | Youngchang Chemical vs. Sungchang Autotech Co |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| 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 | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |