Correlation Between NICE Information and KyungIn Electronics
Can any of the company-specific risk be diversified away by investing in both NICE Information and KyungIn Electronics 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 NICE Information and KyungIn Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NICE Information Service and KyungIn Electronics Co, you can compare the effects of market volatilities on NICE Information and KyungIn Electronics 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 NICE Information with a short position of KyungIn Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of NICE Information and KyungIn Electronics.
Diversification Opportunities for NICE Information and KyungIn Electronics
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NICE and KyungIn is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding NICE Information Service and KyungIn Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KyungIn Electronics and NICE Information 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 NICE Information Service are associated (or correlated) with KyungIn Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KyungIn Electronics has no effect on the direction of NICE Information i.e., NICE Information and KyungIn Electronics go up and down completely randomly.
Pair Corralation between NICE Information and KyungIn Electronics
Assuming the 90 days trading horizon NICE Information Service is expected to generate 1.77 times more return on investment than KyungIn Electronics. However, NICE Information is 1.77 times more volatile than KyungIn Electronics Co. It trades about -0.07 of its potential returns per unit of risk. KyungIn Electronics Co is currently generating about -0.19 per unit of risk. If you would invest 1,215,000 in NICE Information Service on October 18, 2024 and sell it today you would lose (37,000) from holding NICE Information Service or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NICE Information Service vs. KyungIn Electronics Co
Performance |
| Timeline |
| NICE Information Service |
| KyungIn Electronics |
NICE Information and KyungIn Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NICE Information and KyungIn Electronics
The main advantage of trading using opposite NICE Information and KyungIn Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NICE Information position performs unexpectedly, KyungIn Electronics 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 KyungIn Electronics will offset losses from the drop in KyungIn Electronics' long position.| NICE Information vs. Koryo Credit Information | NICE Information vs. KakaoBank Corp | NICE Information vs. MediaZen | NICE Information vs. Lotte Non Life Insurance |
| KyungIn Electronics vs. NICE Information Service | KyungIn Electronics vs. Jeong Moon Information | KyungIn Electronics vs. Nice Information Telecommunication | KyungIn Electronics vs. BGF Retail 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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