Correlation Between Kukdong Oil and SundayToz Corp
Can any of the company-specific risk be diversified away by investing in both Kukdong Oil and SundayToz Corp 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 SundayToz Corp 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 SundayToz Corp, you can compare the effects of market volatilities on Kukdong Oil and SundayToz Corp 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 SundayToz Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukdong Oil and SundayToz Corp.
Diversification Opportunities for Kukdong Oil and SundayToz Corp
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kukdong and SundayToz is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Kukdong Oil Chemicals and SundayToz Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SundayToz Corp 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 SundayToz Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SundayToz Corp has no effect on the direction of Kukdong Oil i.e., Kukdong Oil and SundayToz Corp go up and down completely randomly.
Pair Corralation between Kukdong Oil and SundayToz Corp
Assuming the 90 days trading horizon Kukdong Oil Chemicals is expected to generate 0.62 times more return on investment than SundayToz Corp. However, Kukdong Oil Chemicals is 1.6 times less risky than SundayToz Corp. It trades about -0.02 of its potential returns per unit of risk. SundayToz Corp is currently generating about -0.05 per unit of risk. If you would invest 395,000 in Kukdong Oil Chemicals on September 1, 2024 and sell it today you would lose (37,000) from holding Kukdong Oil Chemicals or give up 9.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.45% |
| Values | Daily Returns |
Kukdong Oil Chemicals vs. SundayToz Corp
Performance |
| Timeline |
| Kukdong Oil Chemicals |
| SundayToz Corp |
Kukdong Oil and SundayToz Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukdong Oil and SundayToz Corp
The main advantage of trading using opposite Kukdong Oil and SundayToz Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukdong Oil position performs unexpectedly, SundayToz Corp 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 SundayToz Corp will offset losses from the drop in SundayToz Corp's long position.| Kukdong Oil vs. AptaBio Therapeutics | Kukdong Oil vs. Daewoo SBI SPAC | Kukdong Oil vs. Dream Security co | Kukdong Oil vs. Microfriend |
| SundayToz Corp vs. AfreecaTV Co | SundayToz Corp vs. Seegene | SundayToz Corp vs. SS TECH | SundayToz Corp vs. Busan Industrial 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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