Correlation Between Woori Technology and CS BEARING
Can any of the company-specific risk be diversified away by investing in both Woori Technology and CS BEARING 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 CS BEARING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Technology and CS BEARING CoLtd, you can compare the effects of market volatilities on Woori Technology and CS BEARING 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 CS BEARING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and CS BEARING.
Diversification Opportunities for Woori Technology and CS BEARING
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Woori and 297090 is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology and CS BEARING CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CS BEARING CoLtd 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 CS BEARING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CS BEARING CoLtd has no effect on the direction of Woori Technology i.e., Woori Technology and CS BEARING go up and down completely randomly.
Pair Corralation between Woori Technology and CS BEARING
Assuming the 90 days trading horizon Woori Technology is expected to under-perform the CS BEARING. But the stock apears to be less risky and, when comparing its historical volatility, Woori Technology is 1.02 times less risky than CS BEARING. The stock trades about -0.28 of its potential returns per unit of risk. The CS BEARING CoLtd is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 423,500 in CS BEARING CoLtd on September 13, 2024 and sell it today you would lose (5,500) from holding CS BEARING CoLtd or give up 1.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Technology vs. CS BEARING CoLtd
Performance |
| Timeline |
| Woori Technology |
| CS BEARING CoLtd |
Woori Technology and CS BEARING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and CS BEARING
The main advantage of trading using opposite Woori Technology and CS BEARING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology position performs unexpectedly, CS BEARING 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 CS BEARING will offset losses from the drop in CS BEARING's long position.| Woori Technology vs. Dongwoo Farm To | Woori Technology vs. KEPCO Engineering Construction | Woori Technology vs. Kumho Industrial Co | Woori Technology vs. Formetal Co |
| CS BEARING vs. Jeju Beer Co | CS BEARING vs. Bohae Brewery | CS BEARING vs. Guyoung Technology Co | CS BEARING vs. Woori Technology |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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