Correlation Between Korea Alcohol and JC Chemical
Can any of the company-specific risk be diversified away by investing in both Korea Alcohol and JC 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 Korea Alcohol and JC Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Alcohol Industrial and JC Chemical Co, you can compare the effects of market volatilities on Korea Alcohol and JC 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 Korea Alcohol with a short position of JC Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Alcohol and JC Chemical.
Diversification Opportunities for Korea Alcohol and JC Chemical
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Korea and 137950 is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Korea Alcohol Industrial and JC Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JC Chemical and Korea Alcohol 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 Korea Alcohol Industrial are associated (or correlated) with JC Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JC Chemical has no effect on the direction of Korea Alcohol i.e., Korea Alcohol and JC Chemical go up and down completely randomly.
Pair Corralation between Korea Alcohol and JC Chemical
Assuming the 90 days trading horizon Korea Alcohol Industrial is expected to generate 1.03 times more return on investment than JC Chemical. However, Korea Alcohol is 1.03 times more volatile than JC Chemical Co. It trades about -0.01 of its potential returns per unit of risk. JC Chemical Co is currently generating about -0.04 per unit of risk. If you would invest 1,020,578 in Korea Alcohol Industrial on September 3, 2024 and sell it today you would lose (173,578) from holding Korea Alcohol Industrial or give up 17.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Alcohol Industrial vs. JC Chemical Co
Performance |
| Timeline |
| Korea Alcohol Industrial |
| JC Chemical |
Korea Alcohol and JC Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Alcohol and JC Chemical
The main advantage of trading using opposite Korea Alcohol and JC Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Alcohol position performs unexpectedly, JC 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 JC Chemical will offset losses from the drop in JC Chemical's long position.| Korea Alcohol vs. KMH Hitech Co | Korea Alcohol vs. Songwon Industrial Co | Korea Alcohol vs. Cots Technology Co | Korea Alcohol vs. Korea Shipbuilding Offshore |
| JC Chemical vs. Busan Industrial Co | JC Chemical vs. UNISEM Co | JC Chemical vs. RPBio Inc | JC Chemical vs. Finebesteel |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |