Correlation Between Atinum Investment and Korea Air
Can any of the company-specific risk be diversified away by investing in both Atinum Investment and Korea Air 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 Atinum Investment and Korea Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atinum Investment Co and Korea Air Svc, you can compare the effects of market volatilities on Atinum Investment and Korea Air 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 Atinum Investment with a short position of Korea Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atinum Investment and Korea Air.
Diversification Opportunities for Atinum Investment and Korea Air
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Atinum and Korea is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Atinum Investment Co and Korea Air Svc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Air Svc and Atinum Investment 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 Atinum Investment Co are associated (or correlated) with Korea Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Air Svc has no effect on the direction of Atinum Investment i.e., Atinum Investment and Korea Air go up and down completely randomly.
Pair Corralation between Atinum Investment and Korea Air
Assuming the 90 days trading horizon Atinum Investment is expected to generate 5.35 times less return on investment than Korea Air. In addition to that, Atinum Investment is 1.14 times more volatile than Korea Air Svc. It trades about 0.01 of its total potential returns per unit of risk. Korea Air Svc is currently generating about 0.05 per unit of volatility. If you would invest 3,989,570 in Korea Air Svc on August 29, 2024 and sell it today you would earn a total of 1,710,430 from holding Korea Air Svc or generate 42.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atinum Investment Co vs. Korea Air Svc
Performance |
| Timeline |
| Atinum Investment |
| Korea Air Svc |
Atinum Investment and Korea Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atinum Investment and Korea Air
The main advantage of trading using opposite Atinum Investment and Korea Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atinum Investment position performs unexpectedly, Korea Air 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 Korea Air will offset losses from the drop in Korea Air's long position.| Atinum Investment vs. Korea New Network | Atinum Investment vs. Dong A Eltek | Atinum Investment vs. Dreamus Company | Atinum Investment vs. SK Bioscience Co |
| Korea Air vs. SBI Investment KOREA | Korea Air vs. Stic Investments | Korea Air vs. E Investment Development | Korea Air vs. NH Investment Securities |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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