Correlation Between Pungguk Ethanol and Insung Information
Can any of the company-specific risk be diversified away by investing in both Pungguk Ethanol and Insung Information 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 Insung Information 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 Insung Information Co, you can compare the effects of market volatilities on Pungguk Ethanol and Insung Information 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 Insung Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pungguk Ethanol and Insung Information.
Diversification Opportunities for Pungguk Ethanol and Insung Information
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pungguk and Insung is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Pungguk Ethanol Industrial and Insung Information Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insung Information 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 Insung Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insung Information has no effect on the direction of Pungguk Ethanol i.e., Pungguk Ethanol and Insung Information go up and down completely randomly.
Pair Corralation between Pungguk Ethanol and Insung Information
Assuming the 90 days trading horizon Pungguk Ethanol Industrial is expected to generate 0.38 times more return on investment than Insung Information. However, Pungguk Ethanol Industrial is 2.65 times less risky than Insung Information. It trades about -0.17 of its potential returns per unit of risk. Insung Information Co is currently generating about -0.09 per unit of risk. If you would invest 1,321,000 in Pungguk Ethanol Industrial on September 13, 2024 and sell it today you would lose (386,000) from holding Pungguk Ethanol Industrial or give up 29.22% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Pungguk Ethanol Industrial vs. Insung Information Co
Performance |
Timeline |
Pungguk Ethanol Indu |
Insung Information |
Pungguk Ethanol and Insung Information Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pungguk Ethanol and Insung Information
The main advantage of trading using opposite Pungguk Ethanol and Insung Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pungguk Ethanol position performs unexpectedly, Insung Information 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 Insung Information will offset losses from the drop in Insung Information's long position.Pungguk Ethanol vs. Korea New Network | Pungguk Ethanol vs. ICD Co | Pungguk Ethanol vs. DYPNF CoLtd | Pungguk Ethanol vs. Solution Advanced Technology |
Insung Information vs. Daejung Chemicals Metals | Insung Information vs. FNC Entertainment Co | Insung Information vs. DONGKUK TED METAL | Insung Information vs. Dongil Metal Co |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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