Correlation Between Korea Information and AeroSpace Technology
Can any of the company-specific risk be diversified away by investing in both Korea Information and AeroSpace Technology 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 AeroSpace Technology 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 AeroSpace Technology of, you can compare the effects of market volatilities on Korea Information and AeroSpace Technology 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 AeroSpace Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Information and AeroSpace Technology.
Diversification Opportunities for Korea Information and AeroSpace Technology
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Korea and AeroSpace is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Korea Information Communicatio and AeroSpace Technology of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AeroSpace Technology 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 AeroSpace Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AeroSpace Technology has no effect on the direction of Korea Information i.e., Korea Information and AeroSpace Technology go up and down completely randomly.
Pair Corralation between Korea Information and AeroSpace Technology
Assuming the 90 days trading horizon Korea Information Communications is expected to generate 0.3 times more return on investment than AeroSpace Technology. However, Korea Information Communications is 3.35 times less risky than AeroSpace Technology. It trades about -0.04 of its potential returns per unit of risk. AeroSpace Technology of is currently generating about -0.04 per unit of risk. If you would invest 1,141,000 in Korea Information Communications on October 29, 2024 and sell it today you would lose (345,000) from holding Korea Information Communications or give up 30.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.27% |
| Values | Daily Returns |
Korea Information Communicatio vs. AeroSpace Technology of
Performance |
| Timeline |
| Korea Information |
| AeroSpace Technology |
Korea Information and AeroSpace Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Information and AeroSpace Technology
The main advantage of trading using opposite Korea Information and AeroSpace Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Information position performs unexpectedly, AeroSpace Technology 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 AeroSpace Technology will offset losses from the drop in AeroSpace Technology's long position.| Korea Information vs. TS Investment Corp | Korea Information vs. Tae Kyung Chemical | Korea Information vs. Kyung In Synthetic Corp | Korea Information vs. KTB Investment Securities |
| AeroSpace Technology vs. Samsung Electronics Co | AeroSpace Technology vs. Samsung Electronics Co | AeroSpace Technology vs. KB Financial Group | AeroSpace Technology vs. Shinhan Financial Group |
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.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |