Correlation Between Jeil Steel and Jahwa Electron
Can any of the company-specific risk be diversified away by investing in both Jeil Steel and Jahwa Electron 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 Jeil Steel and Jahwa Electron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeil Steel Mfg and Jahwa Electron, you can compare the effects of market volatilities on Jeil Steel and Jahwa Electron 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 Jeil Steel with a short position of Jahwa Electron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeil Steel and Jahwa Electron.
Diversification Opportunities for Jeil Steel and Jahwa Electron
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jeil and Jahwa is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Jeil Steel Mfg and Jahwa Electron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jahwa Electron and Jeil 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 Jeil Steel Mfg are associated (or correlated) with Jahwa Electron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jahwa Electron has no effect on the direction of Jeil Steel i.e., Jeil Steel and Jahwa Electron go up and down completely randomly.
Pair Corralation between Jeil Steel and Jahwa Electron
Assuming the 90 days trading horizon Jeil Steel Mfg is expected to generate 1.58 times more return on investment than Jahwa Electron. However, Jeil Steel is 1.58 times more volatile than Jahwa Electron. It trades about 0.11 of its potential returns per unit of risk. Jahwa Electron is currently generating about -0.2 per unit of risk. If you would invest 135,100 in Jeil Steel Mfg on September 12, 2024 and sell it today you would earn a total of 36,800 from holding Jeil Steel Mfg or generate 27.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeil Steel Mfg vs. Jahwa Electron
Performance |
| Timeline |
| Jeil Steel Mfg |
| Jahwa Electron |
Jeil Steel and Jahwa Electron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeil Steel and Jahwa Electron
The main advantage of trading using opposite Jeil Steel and Jahwa Electron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeil Steel position performs unexpectedly, Jahwa Electron 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 Jahwa Electron will offset losses from the drop in Jahwa Electron's long position.| Jeil Steel vs. Keum Kang Steel | Jeil Steel vs. PJ Metal Co | Jeil Steel vs. Samhyun Steel Co | Jeil Steel vs. Gyeongnam Steel Co |
| Jahwa Electron vs. Cube Entertainment | Jahwa Electron vs. Dreamus Company | Jahwa Electron vs. LG Energy Solution | Jahwa Electron vs. Dongwon System |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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