Correlation Between BooKook Steel and Genie Music
Can any of the company-specific risk be diversified away by investing in both BooKook Steel and Genie Music 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 BooKook Steel and Genie Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BooKook Steel Co and Genie Music, you can compare the effects of market volatilities on BooKook Steel and Genie Music 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 BooKook Steel with a short position of Genie Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of BooKook Steel and Genie Music.
Diversification Opportunities for BooKook Steel and Genie Music
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BooKook and Genie is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding BooKook Steel Co and Genie Music in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genie Music and BooKook Steel 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 BooKook Steel Co are associated (or correlated) with Genie Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genie Music has no effect on the direction of BooKook Steel i.e., BooKook Steel and Genie Music go up and down completely randomly.
Pair Corralation between BooKook Steel and Genie Music
Assuming the 90 days trading horizon BooKook Steel Co is expected to generate 0.95 times more return on investment than Genie Music. However, BooKook Steel Co is 1.05 times less risky than Genie Music. It trades about 0.17 of its potential returns per unit of risk. Genie Music is currently generating about 0.0 per unit of risk. If you would invest 241,530 in BooKook Steel Co on October 21, 2024 and sell it today you would earn a total of 15,470 from holding BooKook Steel Co or generate 6.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BooKook Steel Co vs. Genie Music
Performance |
| Timeline |
| BooKook Steel |
| Genie Music |
BooKook Steel and Genie Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BooKook Steel and Genie Music
The main advantage of trading using opposite BooKook Steel and Genie Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BooKook Steel position performs unexpectedly, Genie Music 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 Genie Music will offset losses from the drop in Genie Music's long position.| BooKook Steel vs. PNC Technologies co | BooKook Steel vs. CU Tech Corp | BooKook Steel vs. Amogreentech Co | BooKook Steel vs. Top Material Co |
| Genie Music vs. LG Display Co | Genie Music vs. Daishin Information Communications | Genie Music vs. FoodNamoo | Genie Music vs. Seoul Food Industrial |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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