Correlation Between J Steel and Foodnamoo
Can any of the company-specific risk be diversified away by investing in both J Steel and Foodnamoo 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 Foodnamoo 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 Foodnamoo, you can compare the effects of market volatilities on J Steel and Foodnamoo 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 Foodnamoo. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Steel and Foodnamoo.
Diversification Opportunities for J Steel and Foodnamoo
Weak diversification
The 3 months correlation between 023440 and Foodnamoo is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding J Steel Co and Foodnamoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foodnamoo 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 Foodnamoo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foodnamoo has no effect on the direction of J Steel i.e., J Steel and Foodnamoo go up and down completely randomly.
Pair Corralation between J Steel and Foodnamoo
Assuming the 90 days trading horizon J Steel Co is expected to under-perform the Foodnamoo. In addition to that, J Steel is 1.12 times more volatile than Foodnamoo. It trades about -0.35 of its total potential returns per unit of risk. Foodnamoo is currently generating about -0.35 per unit of volatility. If you would invest 314,000 in Foodnamoo on October 18, 2024 and sell it today you would lose (42,500) from holding Foodnamoo or give up 13.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
J Steel Co vs. Foodnamoo
Performance |
| Timeline |
| J Steel |
| Foodnamoo |
J Steel and Foodnamoo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Steel and Foodnamoo
The main advantage of trading using opposite J Steel and Foodnamoo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Steel position performs unexpectedly, Foodnamoo 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 Foodnamoo will offset losses from the drop in Foodnamoo's long position.| J Steel vs. Samsung Electronics Co | J Steel vs. Samsung Electronics Co | J Steel vs. LG Energy Solution | J Steel vs. SK Hynix |
| Foodnamoo vs. Infinitt Healthcare Co | Foodnamoo vs. J Steel Co | Foodnamoo vs. Wonil Special Steel | Foodnamoo vs. INSUN Environmental New |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |