Correlation Between Kyung Chang and Seronics
Can any of the company-specific risk be diversified away by investing in both Kyung Chang and Seronics 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 Kyung Chang and Seronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kyung Chang Industrial and Seronics Co, you can compare the effects of market volatilities on Kyung Chang and Seronics 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 Kyung Chang with a short position of Seronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyung Chang and Seronics.
Diversification Opportunities for Kyung Chang and Seronics
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kyung and Seronics is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Kyung Chang Industrial and Seronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seronics and Kyung Chang 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 Kyung Chang Industrial are associated (or correlated) with Seronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seronics has no effect on the direction of Kyung Chang i.e., Kyung Chang and Seronics go up and down completely randomly.
Pair Corralation between Kyung Chang and Seronics
Assuming the 90 days trading horizon Kyung Chang Industrial is expected to generate 1.15 times more return on investment than Seronics. However, Kyung Chang is 1.15 times more volatile than Seronics Co. It trades about 0.0 of its potential returns per unit of risk. Seronics Co is currently generating about -0.11 per unit of risk. If you would invest 227,500 in Kyung Chang Industrial on September 3, 2024 and sell it today you would lose (27,500) from holding Kyung Chang Industrial or give up 12.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kyung Chang Industrial vs. Seronics Co
Performance |
| Timeline |
| Kyung Chang Industrial |
| Seronics |
Kyung Chang and Seronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kyung Chang and Seronics
The main advantage of trading using opposite Kyung Chang and Seronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyung Chang position performs unexpectedly, Seronics 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 Seronics will offset losses from the drop in Seronics' long position.| Kyung Chang vs. Orbitech Co | Kyung Chang vs. TK Chemical | Kyung Chang vs. Shinsung Delta Tech | Kyung Chang vs. Posco Chemical Co |
| Seronics vs. Sangshin Electronics Co | Seronics vs. DAEDUCK ELECTRONICS CoLtd | Seronics vs. Shinil Electronics Co | Seronics vs. KyungIn Electronics 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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