Correlation Between Iljin Display and PK Skin
Can any of the company-specific risk be diversified away by investing in both Iljin Display and PK Skin 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 Iljin Display and PK Skin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iljin Display and PK Skin Research, you can compare the effects of market volatilities on Iljin Display and PK Skin 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 Iljin Display with a short position of PK Skin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iljin Display and PK Skin.
Diversification Opportunities for Iljin Display and PK Skin
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Iljin and 347740 is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Iljin Display and PK Skin Research in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PK Skin Research and Iljin Display 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 Iljin Display are associated (or correlated) with PK Skin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PK Skin Research has no effect on the direction of Iljin Display i.e., Iljin Display and PK Skin go up and down completely randomly.
Pair Corralation between Iljin Display and PK Skin
Assuming the 90 days trading horizon Iljin Display is expected to generate 1.22 times more return on investment than PK Skin. However, Iljin Display is 1.22 times more volatile than PK Skin Research. It trades about -0.01 of its potential returns per unit of risk. PK Skin Research is currently generating about -0.02 per unit of risk. If you would invest 126,000 in Iljin Display on September 12, 2024 and sell it today you would lose (42,000) from holding Iljin Display or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Iljin Display vs. PK Skin Research
Performance |
| Timeline |
| Iljin Display |
| PK Skin Research |
Iljin Display and PK Skin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iljin Display and PK Skin
The main advantage of trading using opposite Iljin Display and PK Skin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iljin Display position performs unexpectedly, PK Skin 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 PK Skin will offset losses from the drop in PK Skin's long position.| Iljin Display vs. DAEDUCK ELECTRONICS CoLtd | Iljin Display vs. Sungmoon Electronics Co | Iljin Display vs. Solution Advanced Technology | Iljin Display vs. Busan Industrial Co |
| PK Skin vs. Samsung Electronics Co | PK Skin vs. Samsung Electronics Co | PK Skin vs. LG Energy Solution | PK Skin vs. SK Hynix |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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