Correlation Between Pungguk Ethanol and Automobile
Can any of the company-specific risk be diversified away by investing in both Pungguk Ethanol and Automobile 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 Pungguk Ethanol and Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pungguk Ethanol Industrial and Automobile Pc, you can compare the effects of market volatilities on Pungguk Ethanol and Automobile 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 Pungguk Ethanol with a short position of Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pungguk Ethanol and Automobile.
Diversification Opportunities for Pungguk Ethanol and Automobile
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pungguk and Automobile is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Pungguk Ethanol Industrial and Automobile Pc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automobile Pc and Pungguk Ethanol 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 Pungguk Ethanol Industrial are associated (or correlated) with Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automobile Pc has no effect on the direction of Pungguk Ethanol i.e., Pungguk Ethanol and Automobile go up and down completely randomly.
Pair Corralation between Pungguk Ethanol and Automobile
Assuming the 90 days trading horizon Pungguk Ethanol Industrial is expected to generate 0.65 times more return on investment than Automobile. However, Pungguk Ethanol Industrial is 1.54 times less risky than Automobile. It trades about -0.03 of its potential returns per unit of risk. Automobile Pc is currently generating about -0.04 per unit of risk. If you would invest 1,455,530 in Pungguk Ethanol Industrial on September 2, 2024 and sell it today you would lose (468,530) from holding Pungguk Ethanol Industrial or give up 32.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pungguk Ethanol Industrial vs. Automobile Pc
Performance |
| Timeline |
| Pungguk Ethanol Indu |
| Automobile Pc |
Pungguk Ethanol and Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pungguk Ethanol and Automobile
The main advantage of trading using opposite Pungguk Ethanol and Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pungguk Ethanol position performs unexpectedly, Automobile 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 Automobile will offset losses from the drop in Automobile's long position.| Pungguk Ethanol vs. Korea Real Estate | Pungguk Ethanol vs. Korea Ratings Co | Pungguk Ethanol vs. IQuest Co | Pungguk Ethanol vs. Wonbang Tech Co |
| Automobile vs. LG Display | Automobile vs. Hyundai Motor Co | Automobile vs. Hyundai Motor Co | Automobile vs. Adaptive Plasma Technology |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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