Correlation Between Seoul Electronics and KCC Engineering
Can any of the company-specific risk be diversified away by investing in both Seoul Electronics and KCC Engineering 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 Seoul Electronics and KCC Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seoul Electronics Telecom and KCC Engineering Construction, you can compare the effects of market volatilities on Seoul Electronics and KCC Engineering 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 Seoul Electronics with a short position of KCC Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seoul Electronics and KCC Engineering.
Diversification Opportunities for Seoul Electronics and KCC Engineering
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Seoul and KCC is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Seoul Electronics Telecom and KCC Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KCC Engineering Cons and Seoul Electronics 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 Seoul Electronics Telecom are associated (or correlated) with KCC Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KCC Engineering Cons has no effect on the direction of Seoul Electronics i.e., Seoul Electronics and KCC Engineering go up and down completely randomly.
Pair Corralation between Seoul Electronics and KCC Engineering
Assuming the 90 days trading horizon Seoul Electronics Telecom is expected to generate 2.74 times more return on investment than KCC Engineering. However, Seoul Electronics is 2.74 times more volatile than KCC Engineering Construction. It trades about 0.34 of its potential returns per unit of risk. KCC Engineering Construction is currently generating about -0.09 per unit of risk. If you would invest 22,100 in Seoul Electronics Telecom on October 20, 2024 and sell it today you would earn a total of 4,000 from holding Seoul Electronics Telecom or generate 18.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seoul Electronics Telecom vs. KCC Engineering Construction
Performance |
| Timeline |
| Seoul Electronics Telecom |
| KCC Engineering Cons |
Seoul Electronics and KCC Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seoul Electronics and KCC Engineering
The main advantage of trading using opposite Seoul Electronics and KCC Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seoul Electronics position performs unexpectedly, KCC Engineering 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 KCC Engineering will offset losses from the drop in KCC Engineering's long position.| Seoul Electronics vs. Dongil Metal Co | Seoul Electronics vs. Korea Information Engineering | Seoul Electronics vs. Duksan Hi Metal | Seoul Electronics vs. System and Application |
| KCC Engineering vs. Amogreentech Co | KCC Engineering vs. SungMoon Electronics Co | KCC Engineering vs. Jeju Air Co | KCC Engineering vs. Seoul Electronics Telecom |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |