Correlation Between Jeil Steel and PanGen Biotech
Can any of the company-specific risk be diversified away by investing in both Jeil Steel and PanGen Biotech 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 PanGen Biotech 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 PanGen Biotech, you can compare the effects of market volatilities on Jeil Steel and PanGen Biotech 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 PanGen Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeil Steel and PanGen Biotech.
Diversification Opportunities for Jeil Steel and PanGen Biotech
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jeil and PanGen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Jeil Steel Mfg and PanGen Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PanGen Biotech 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 PanGen Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PanGen Biotech has no effect on the direction of Jeil Steel i.e., Jeil Steel and PanGen Biotech go up and down completely randomly.
Pair Corralation between Jeil Steel and PanGen Biotech
Assuming the 90 days trading horizon Jeil Steel Mfg is expected to generate 1.23 times more return on investment than PanGen Biotech. However, Jeil Steel is 1.23 times more volatile than PanGen Biotech. It trades about 0.03 of its potential returns per unit of risk. PanGen Biotech is currently generating about 0.02 per unit of risk. If you would invest 155,800 in Jeil Steel Mfg on September 14, 2024 and sell it today you would earn a total of 19,100 from holding Jeil Steel Mfg or generate 12.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.62% |
| Values | Daily Returns |
Jeil Steel Mfg vs. PanGen Biotech
Performance |
| Timeline |
| Jeil Steel Mfg |
| PanGen Biotech |
Jeil Steel and PanGen Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeil Steel and PanGen Biotech
The main advantage of trading using opposite Jeil Steel and PanGen Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeil Steel position performs unexpectedly, PanGen Biotech 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 PanGen Biotech will offset losses from the drop in PanGen Biotech's long position.| Jeil Steel vs. Keum Kang Steel | Jeil Steel vs. Samhyun Steel Co | Jeil Steel vs. Gyeongnam Steel Co | Jeil Steel vs. Wonil Special Steel |
| PanGen Biotech vs. Samsung Biologics Co | PanGen Biotech vs. SK Bioscience Co | PanGen Biotech vs. Sk Biopharmaceuticals Co | PanGen Biotech vs. ABL Bio |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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