Correlation Between Korea Information and Kosdaq Composite
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By analyzing existing cross correlation between Korea Information Communications and Kosdaq Composite Index, you can compare the effects of market volatilities on Korea Information and Kosdaq Composite 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 Kosdaq Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Information and Kosdaq Composite.
Diversification Opportunities for Korea Information and Kosdaq Composite
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Korea and Kosdaq is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Korea Information Communicatio and Kosdaq Composite Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kosdaq Composite Index 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 Kosdaq Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kosdaq Composite Index has no effect on the direction of Korea Information i.e., Korea Information and Kosdaq Composite go up and down completely randomly.
Pair Corralation between Korea Information and Kosdaq Composite
Assuming the 90 days trading horizon Korea Information Communications is expected to under-perform the Kosdaq Composite. But the stock apears to be less risky and, when comparing its historical volatility, Korea Information Communications is 1.51 times less risky than Kosdaq Composite. The stock trades about -0.15 of its potential returns per unit of risk. The Kosdaq Composite Index is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 68,965 in Kosdaq Composite Index on September 14, 2024 and sell it today you would lose (630.00) from holding Kosdaq Composite Index or give up 0.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Information Communicatio vs. Kosdaq Composite Index
Performance |
| Timeline |
Korea Information and Kosdaq Composite Volatility Contrast
Predicted Return Density |
| Returns |
Korea Information Communications
Pair trading matchups for Korea Information
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
Pair Trading with Korea Information and Kosdaq Composite
The main advantage of trading using opposite Korea Information and Kosdaq Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Information position performs unexpectedly, Kosdaq Composite 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 Kosdaq Composite will offset losses from the drop in Kosdaq Composite's long position.| Korea Information vs. Cube Entertainment | Korea Information vs. Dreamus Company | Korea Information vs. LG Energy Solution | Korea Information vs. Dongwon System |
| Kosdaq Composite vs. Nice Information Telecommunication | Kosdaq Composite vs. Seoul Electronics Telecom | Kosdaq Composite vs. Korea Information Communications | Kosdaq Composite vs. Mobile Appliance |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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