Correlation Between LG Uplus and Taewoong Logistics
Can any of the company-specific risk be diversified away by investing in both LG Uplus and Taewoong Logistics 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 LG Uplus and Taewoong Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LG Uplus and Taewoong Logistics CoLtd, you can compare the effects of market volatilities on LG Uplus and Taewoong Logistics 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 LG Uplus with a short position of Taewoong Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG Uplus and Taewoong Logistics.
Diversification Opportunities for LG Uplus and Taewoong Logistics
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between 032640 and Taewoong is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding LG Uplus and Taewoong Logistics CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taewoong Logistics CoLtd and LG Uplus 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 LG Uplus are associated (or correlated) with Taewoong Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taewoong Logistics CoLtd has no effect on the direction of LG Uplus i.e., LG Uplus and Taewoong Logistics go up and down completely randomly.
Pair Corralation between LG Uplus and Taewoong Logistics
Assuming the 90 days trading horizon LG Uplus is expected to generate 0.73 times more return on investment than Taewoong Logistics. However, LG Uplus is 1.36 times less risky than Taewoong Logistics. It trades about 0.4 of its potential returns per unit of risk. Taewoong Logistics CoLtd is currently generating about -0.01 per unit of risk. If you would invest 1,006,000 in LG Uplus on September 4, 2024 and sell it today you would earn a total of 146,000 from holding LG Uplus or generate 14.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LG Uplus vs. Taewoong Logistics CoLtd
Performance |
| Timeline |
| LG Uplus |
| Taewoong Logistics CoLtd |
LG Uplus and Taewoong Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LG Uplus and Taewoong Logistics
The main advantage of trading using opposite LG Uplus and Taewoong Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG Uplus position performs unexpectedly, Taewoong Logistics 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 Taewoong Logistics will offset losses from the drop in Taewoong Logistics' long position.| LG Uplus vs. Jeju Semiconductor Corp | LG Uplus vs. LS Materials | LG Uplus vs. Union Materials Corp | LG Uplus vs. ABOV Semiconductor Co |
| Taewoong Logistics vs. LG Uplus | Taewoong Logistics vs. ASTORY CoLtd | Taewoong Logistics vs. AnterogenCoLtd | Taewoong Logistics vs. Industrial Bank |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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