Correlation Between Korea Real and UJU Electronics
Can any of the company-specific risk be diversified away by investing in both Korea Real and UJU Electronics 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 Korea Real and UJU Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Real Estate and UJU Electronics Co, you can compare the effects of market volatilities on Korea Real and UJU Electronics 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 Korea Real with a short position of UJU Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Real and UJU Electronics.
Diversification Opportunities for Korea Real and UJU Electronics
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Korea and UJU is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Korea Real Estate and UJU Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UJU Electronics and Korea Real 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 Korea Real Estate are associated (or correlated) with UJU Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UJU Electronics has no effect on the direction of Korea Real i.e., Korea Real and UJU Electronics go up and down completely randomly.
Pair Corralation between Korea Real and UJU Electronics
Assuming the 90 days trading horizon Korea Real Estate is expected to generate 0.36 times more return on investment than UJU Electronics. However, Korea Real Estate is 2.78 times less risky than UJU Electronics. It trades about -0.09 of its potential returns per unit of risk. UJU Electronics Co is currently generating about -0.13 per unit of risk. If you would invest 107,800 in Korea Real Estate on September 2, 2024 and sell it today you would lose (5,400) from holding Korea Real Estate or give up 5.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Real Estate vs. UJU Electronics Co
Performance |
| Timeline |
| Korea Real Estate |
| UJU Electronics |
Korea Real and UJU Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Real and UJU Electronics
The main advantage of trading using opposite Korea Real and UJU Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Real position performs unexpectedly, UJU Electronics 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 UJU Electronics will offset losses from the drop in UJU Electronics' long position.| Korea Real vs. Samsung Electronics Co | Korea Real vs. Samsung Electronics Co | Korea Real vs. LG Energy Solution | Korea Real vs. SK Hynix |
| UJU Electronics vs. Dongsin Engineering Construction | UJU Electronics vs. Doosan Fuel Cell | UJU Electronics vs. Daishin Balance 1 | UJU Electronics vs. Total Soft Bank |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |