Correlation Between Jahwa Electron and Youngbo Chemical
Can any of the company-specific risk be diversified away by investing in both Jahwa Electron and Youngbo Chemical 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 Jahwa Electron and Youngbo Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jahwa Electron and Youngbo Chemical Co, you can compare the effects of market volatilities on Jahwa Electron and Youngbo Chemical 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 Jahwa Electron with a short position of Youngbo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jahwa Electron and Youngbo Chemical.
Diversification Opportunities for Jahwa Electron and Youngbo Chemical
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jahwa and Youngbo is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Jahwa Electron and Youngbo Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngbo Chemical and Jahwa Electron 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 Jahwa Electron are associated (or correlated) with Youngbo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youngbo Chemical has no effect on the direction of Jahwa Electron i.e., Jahwa Electron and Youngbo Chemical go up and down completely randomly.
Pair Corralation between Jahwa Electron and Youngbo Chemical
Assuming the 90 days trading horizon Jahwa Electron is expected to generate 2.7 times more return on investment than Youngbo Chemical. However, Jahwa Electron is 2.7 times more volatile than Youngbo Chemical Co. It trades about 0.36 of its potential returns per unit of risk. Youngbo Chemical Co is currently generating about 0.41 per unit of risk. If you would invest 1,172,000 in Jahwa Electron on November 3, 2024 and sell it today you would earn a total of 373,000 from holding Jahwa Electron or generate 31.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jahwa Electron vs. Youngbo Chemical Co
Performance |
| Timeline |
| Jahwa Electron |
| Youngbo Chemical |
Jahwa Electron and Youngbo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jahwa Electron and Youngbo Chemical
The main advantage of trading using opposite Jahwa Electron and Youngbo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jahwa Electron position performs unexpectedly, Youngbo Chemical 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 Youngbo Chemical will offset losses from the drop in Youngbo Chemical's long position.| Jahwa Electron vs. Hanjoo Light Metal | Jahwa Electron vs. Lotte Non Life Insurance | Jahwa Electron vs. Cloud Air CoLtd | Jahwa Electron vs. Kakao Games Corp |
| Youngbo Chemical vs. AptaBio Therapeutics | Youngbo Chemical vs. Daewoo SBI SPAC | Youngbo Chemical vs. Dream Security co | Youngbo Chemical vs. Microfriend |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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