Correlation Between Nepes and JUSUNG ENGINEERING
Can any of the company-specific risk be diversified away by investing in both Nepes and JUSUNG ENGINEERING 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 Nepes and JUSUNG ENGINEERING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nepes and JUSUNG ENGINEERING Co, you can compare the effects of market volatilities on Nepes and JUSUNG ENGINEERING 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 Nepes with a short position of JUSUNG ENGINEERING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nepes and JUSUNG ENGINEERING.
Diversification Opportunities for Nepes and JUSUNG ENGINEERING
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nepes and JUSUNG is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Nepes and JUSUNG ENGINEERING Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JUSUNG ENGINEERING and Nepes 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 Nepes are associated (or correlated) with JUSUNG ENGINEERING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JUSUNG ENGINEERING has no effect on the direction of Nepes i.e., Nepes and JUSUNG ENGINEERING go up and down completely randomly.
Pair Corralation between Nepes and JUSUNG ENGINEERING
Assuming the 90 days trading horizon Nepes is expected to under-perform the JUSUNG ENGINEERING. But the stock apears to be less risky and, when comparing its historical volatility, Nepes is 1.63 times less risky than JUSUNG ENGINEERING. The stock trades about -0.22 of its potential returns per unit of risk. The JUSUNG ENGINEERING Co is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,705,000 in JUSUNG ENGINEERING Co on August 25, 2024 and sell it today you would earn a total of 215,000 from holding JUSUNG ENGINEERING Co or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nepes vs. JUSUNG ENGINEERING Co
Performance |
| Timeline |
| Nepes |
| JUSUNG ENGINEERING |
Nepes and JUSUNG ENGINEERING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nepes and JUSUNG ENGINEERING
The main advantage of trading using opposite Nepes and JUSUNG ENGINEERING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nepes position performs unexpectedly, JUSUNG ENGINEERING 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 JUSUNG ENGINEERING will offset losses from the drop in JUSUNG ENGINEERING's long position.| Nepes vs. Dongjin Semichem Co | Nepes vs. SFA Semicon Co | Nepes vs. Seoul Semiconductor Co | Nepes vs. EO Technics Co |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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