Correlation Between Lee Ku and Woori Technology
Can any of the company-specific risk be diversified away by investing in both Lee Ku and Woori 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 Lee Ku and Woori Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lee Ku Industrial and Woori Technology Investment, you can compare the effects of market volatilities on Lee Ku and Woori 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 Lee Ku with a short position of Woori Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lee Ku and Woori Technology.
Diversification Opportunities for Lee Ku and Woori Technology
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lee and Woori is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Lee Ku Industrial and Woori Technology Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woori Technology Inv and Lee Ku 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 Lee Ku Industrial are associated (or correlated) with Woori Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woori Technology Inv has no effect on the direction of Lee Ku i.e., Lee Ku and Woori Technology go up and down completely randomly.
Pair Corralation between Lee Ku and Woori Technology
Assuming the 90 days trading horizon Lee Ku Industrial is expected to generate 0.64 times more return on investment than Woori Technology. However, Lee Ku Industrial is 1.56 times less risky than Woori Technology. It trades about -0.01 of its potential returns per unit of risk. Woori Technology Investment is currently generating about -0.07 per unit of risk. If you would invest 442,500 in Lee Ku Industrial on October 30, 2024 and sell it today you would lose (20,000) from holding Lee Ku Industrial or give up 4.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lee Ku Industrial vs. Woori Technology Investment
Performance |
| Timeline |
| Lee Ku Industrial |
| Woori Technology Inv |
Lee Ku and Woori Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lee Ku and Woori Technology
The main advantage of trading using opposite Lee Ku and Woori Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lee Ku position performs unexpectedly, Woori 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 Woori Technology will offset losses from the drop in Woori Technology's long position.| Lee Ku vs. Vitzro Tech Co | Lee Ku vs. FNSTech Co | Lee Ku vs. KPX Green Chemical | Lee Ku vs. Daejung Chemicals Metals |
| Woori Technology vs. Humasis Co | Woori Technology vs. JUSUNG ENGINEERING Co | Woori Technology vs. Winix Inc | Woori Technology vs. AfreecaTV 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |