Correlation Between Stic Investments and J Steel
Can any of the company-specific risk be diversified away by investing in both Stic Investments and J Steel 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 Stic Investments and J Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stic Investments and J Steel Co, you can compare the effects of market volatilities on Stic Investments and J Steel 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 Stic Investments with a short position of J Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stic Investments and J Steel.
Diversification Opportunities for Stic Investments and J Steel
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Stic and 023440 is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Stic Investments and J Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J Steel and Stic Investments 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 Stic Investments are associated (or correlated) with J Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J Steel has no effect on the direction of Stic Investments i.e., Stic Investments and J Steel go up and down completely randomly.
Pair Corralation between Stic Investments and J Steel
Assuming the 90 days trading horizon Stic Investments is expected to generate 1.12 times more return on investment than J Steel. However, Stic Investments is 1.12 times more volatile than J Steel Co. It trades about 0.44 of its potential returns per unit of risk. J Steel Co is currently generating about 0.07 per unit of risk. If you would invest 733,000 in Stic Investments on January 18, 2025 and sell it today you would earn a total of 309,000 from holding Stic Investments or generate 42.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stic Investments vs. J Steel Co
Performance |
| Timeline |
| Stic Investments |
| J Steel |
Stic Investments and J Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stic Investments and J Steel
The main advantage of trading using opposite Stic Investments and J Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stic Investments position performs unexpectedly, J Steel 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 J Steel will offset losses from the drop in J Steel's long position.| Stic Investments vs. Korea Air Svc | Stic Investments vs. LS Materials | Stic Investments vs. Air Busan Co | Stic Investments vs. Solus Advanced Materials |
| J Steel vs. KEPCO Engineering Construction | J Steel vs. Golden Bridge Investment | J Steel vs. Woorim Machinery Co | J Steel vs. SV Investment |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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