Correlation Between Jahwa Electron and Korea New
Can any of the company-specific risk be diversified away by investing in both Jahwa Electron and Korea New 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 Korea New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jahwa Electron and Korea New Network, you can compare the effects of market volatilities on Jahwa Electron and Korea New 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 Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jahwa Electron and Korea New.
Diversification Opportunities for Jahwa Electron and Korea New
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jahwa and Korea is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Jahwa Electron and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network 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 Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of Jahwa Electron i.e., Jahwa Electron and Korea New go up and down completely randomly.
Pair Corralation between Jahwa Electron and Korea New
Assuming the 90 days trading horizon Jahwa Electron is expected to under-perform the Korea New. In addition to that, Jahwa Electron is 1.35 times more volatile than Korea New Network. It trades about -0.03 of its total potential returns per unit of risk. Korea New Network is currently generating about 0.0 per unit of volatility. If you would invest 89,093 in Korea New Network on November 2, 2024 and sell it today you would lose (8,093) from holding Korea New Network or give up 9.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jahwa Electron vs. Korea New Network
Performance |
| Timeline |
| Jahwa Electron |
| Korea New Network |
Jahwa Electron and Korea New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jahwa Electron and Korea New
The main advantage of trading using opposite Jahwa Electron and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jahwa Electron position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New'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 |
| Korea New vs. KakaoBank Corp | Korea New vs. CG Hi Tech | Korea New vs. V One Tech Co | Korea New vs. Yura Tech Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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