Correlation Between Pan Ocean and Tuksu Engineering
Can any of the company-specific risk be diversified away by investing in both Pan Ocean and Tuksu 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 Pan Ocean and Tuksu Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Ocean Co and Tuksu Engineering ConstructionLtd, you can compare the effects of market volatilities on Pan Ocean and Tuksu 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 Pan Ocean with a short position of Tuksu Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Ocean and Tuksu Engineering.
Diversification Opportunities for Pan Ocean and Tuksu Engineering
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Pan and Tuksu is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Pan Ocean Co and Tuksu Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tuksu Engineering and Pan Ocean 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 Pan Ocean Co are associated (or correlated) with Tuksu Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tuksu Engineering has no effect on the direction of Pan Ocean i.e., Pan Ocean and Tuksu Engineering go up and down completely randomly.
Pair Corralation between Pan Ocean and Tuksu Engineering
Assuming the 90 days trading horizon Pan Ocean Co is expected to generate 0.54 times more return on investment than Tuksu Engineering. However, Pan Ocean Co is 1.86 times less risky than Tuksu Engineering. It trades about 0.01 of its potential returns per unit of risk. Tuksu Engineering ConstructionLtd is currently generating about -0.08 per unit of risk. If you would invest 347,000 in Pan Ocean Co on September 13, 2024 and sell it today you would lose (500.00) from holding Pan Ocean Co or give up 0.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Pan Ocean Co vs. Tuksu Engineering Construction
Performance |
| Timeline |
| Pan Ocean |
| Tuksu Engineering |
Pan Ocean and Tuksu Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Ocean and Tuksu Engineering
The main advantage of trading using opposite Pan Ocean and Tuksu Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Ocean position performs unexpectedly, Tuksu 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 Tuksu Engineering will offset losses from the drop in Tuksu Engineering's long position.| Pan Ocean vs. Korea New Network | Pan Ocean vs. Solution Advanced Technology | Pan Ocean vs. Busan Industrial Co | Pan Ocean vs. Busan Ind |
| Tuksu Engineering vs. Korea New Network | Tuksu Engineering vs. Solution Advanced Technology | Tuksu Engineering vs. Busan Industrial Co | Tuksu Engineering vs. Busan Ind |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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