Correlation Between J Steel and Youngchang Chemical
Can any of the company-specific risk be diversified away by investing in both J Steel 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 J Steel and Youngchang Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J Steel Co and Youngchang Chemical Co, you can compare the effects of market volatilities on J Steel 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 J Steel with a short position of Youngchang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Steel and Youngchang Chemical.
Diversification Opportunities for J Steel and Youngchang Chemical
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 023440 and Youngchang is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding J Steel Co and Youngchang Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngchang Chemical and J Steel 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 J Steel Co 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 J Steel i.e., J Steel and Youngchang Chemical go up and down completely randomly.
Pair Corralation between J Steel and Youngchang Chemical
Assuming the 90 days trading horizon J Steel Co is expected to generate 1.71 times more return on investment than Youngchang Chemical. However, J Steel is 1.71 times more volatile than Youngchang Chemical Co. It trades about 0.03 of its potential returns per unit of risk. Youngchang Chemical Co is currently generating about -0.29 per unit of risk. If you would invest 177,800 in J Steel Co on September 1, 2024 and sell it today you would earn a total of 1,200 from holding J Steel Co or generate 0.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
J Steel Co vs. Youngchang Chemical Co
Performance |
| Timeline |
| J Steel |
| Youngchang Chemical |
J Steel and Youngchang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Steel and Youngchang Chemical
The main advantage of trading using opposite J Steel and Youngchang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Steel 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.| J Steel vs. Koh Young Technology | J Steel vs. NewFlex Technology Co | J Steel vs. Samlip General Foods | J Steel vs. Hankukpackage Co |
| Youngchang Chemical vs. LG Chem | Youngchang Chemical vs. Chunbo Co | Youngchang Chemical vs. Hyosung Chemical Corp | Youngchang Chemical vs. LIG ES SPAC |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |