Correlation Between Korea Information and Kuk Young
Can any of the company-specific risk be diversified away by investing in both Korea Information and Kuk Young 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 Korea Information and Kuk Young into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Information Communications and Kuk Young GM, you can compare the effects of market volatilities on Korea Information and Kuk Young 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 Korea Information with a short position of Kuk Young. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Information and Kuk Young.
Diversification Opportunities for Korea Information and Kuk Young
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Korea and Kuk is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Korea Information Communicatio and Kuk Young GM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuk Young GM and Korea Information 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 Korea Information Communications are associated (or correlated) with Kuk Young. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuk Young GM has no effect on the direction of Korea Information i.e., Korea Information and Kuk Young go up and down completely randomly.
Pair Corralation between Korea Information and Kuk Young
Assuming the 90 days trading horizon Korea Information Communications is expected to under-perform the Kuk Young. But the stock apears to be less risky and, when comparing its historical volatility, Korea Information Communications is 2.01 times less risky than Kuk Young. The stock trades about 0.0 of its potential returns per unit of risk. The Kuk Young GM is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 133,400 in Kuk Young GM on August 25, 2024 and sell it today you would earn a total of 90,100 from holding Kuk Young GM or generate 67.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Information Communicatio vs. Kuk Young GM
Performance |
| Timeline |
| Korea Information |
| Kuk Young GM |
Korea Information and Kuk Young Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Information and Kuk Young
The main advantage of trading using opposite Korea Information and Kuk Young positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Information position performs unexpectedly, Kuk Young 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 Kuk Young will offset losses from the drop in Kuk Young's long position.| Korea Information vs. Korea Real Estate | Korea Information vs. Korea Ratings Co | Korea Information vs. IQuest Co | Korea Information vs. Wonbang Tech Co |
| Kuk Young vs. Korea Information Communications | Kuk Young vs. Automobile Pc | Kuk Young vs. Golden Bridge Investment | Kuk Young vs. Asiana Airlines |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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