Correlation Between TJ Media and SKONEC Entertainment
Can any of the company-specific risk be diversified away by investing in both TJ Media and SKONEC Entertainment 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 TJ Media and SKONEC Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TJ media Co and SKONEC Entertainment Co, you can compare the effects of market volatilities on TJ Media and SKONEC Entertainment 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 TJ Media with a short position of SKONEC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of TJ Media and SKONEC Entertainment.
Diversification Opportunities for TJ Media and SKONEC Entertainment
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between 032540 and SKONEC is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding TJ media Co and SKONEC Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SKONEC Entertainment and TJ Media 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 TJ media Co are associated (or correlated) with SKONEC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SKONEC Entertainment has no effect on the direction of TJ Media i.e., TJ Media and SKONEC Entertainment go up and down completely randomly.
Pair Corralation between TJ Media and SKONEC Entertainment
Assuming the 90 days trading horizon TJ media Co is expected to under-perform the SKONEC Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, TJ media Co is 2.95 times less risky than SKONEC Entertainment. The stock trades about -0.42 of its potential returns per unit of risk. The SKONEC Entertainment Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 309,000 in SKONEC Entertainment Co on August 31, 2024 and sell it today you would earn a total of 6,500 from holding SKONEC Entertainment Co or generate 2.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TJ media Co vs. SKONEC Entertainment Co
Performance |
| Timeline |
| TJ media |
| SKONEC Entertainment |
TJ Media and SKONEC Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TJ Media and SKONEC Entertainment
The main advantage of trading using opposite TJ Media and SKONEC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TJ Media position performs unexpectedly, SKONEC Entertainment 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 SKONEC Entertainment will offset losses from the drop in SKONEC Entertainment's long position.| TJ Media vs. LG Display | TJ Media vs. Hyundai Motor | TJ Media vs. Hyundai Motor Co | TJ Media vs. Hyundai Motor Co |
| SKONEC Entertainment vs. Kakao Games Corp | SKONEC Entertainment vs. Devsisters corporation | SKONEC Entertainment vs. Konan Technology | SKONEC Entertainment vs. Nice Information Telecommunication |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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