Correlation Between Woori Technology and GS Retail
Can any of the company-specific risk be diversified away by investing in both Woori Technology and GS Retail 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 Woori Technology and GS Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Technology and GS Retail Co, you can compare the effects of market volatilities on Woori Technology and GS Retail 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 Woori Technology with a short position of GS Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and GS Retail.
Diversification Opportunities for Woori Technology and GS Retail
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Woori and 007070 is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology and GS Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GS Retail and Woori Technology 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 Woori Technology are associated (or correlated) with GS Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GS Retail has no effect on the direction of Woori Technology i.e., Woori Technology and GS Retail go up and down completely randomly.
Pair Corralation between Woori Technology and GS Retail
Assuming the 90 days trading horizon Woori Technology is expected to generate 5.23 times less return on investment than GS Retail. In addition to that, Woori Technology is 1.93 times more volatile than GS Retail Co. It trades about 0.01 of its total potential returns per unit of risk. GS Retail Co is currently generating about 0.05 per unit of volatility. If you would invest 2,210,000 in GS Retail Co on September 3, 2024 and sell it today you would earn a total of 105,000 from holding GS Retail Co or generate 4.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 96.61% |
| Values | Daily Returns |
Woori Technology vs. GS Retail Co
Performance |
| Timeline |
| Woori Technology |
| GS Retail |
Woori Technology and GS Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and GS Retail
The main advantage of trading using opposite Woori Technology and GS Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology position performs unexpectedly, GS Retail 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 GS Retail will offset losses from the drop in GS Retail's long position.| Woori Technology vs. GS Retail Co | Woori Technology vs. Neungyule Education | Woori Technology vs. KMH Hitech Co | Woori Technology vs. Sungchang Autotech Co |
| GS Retail vs. CU Medical Systems | GS Retail vs. Daejung Chemicals Metals | GS Retail vs. Alton Sports CoLtd | GS Retail vs. Hannong Chemicals |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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