Correlation Between Naver and Mirae Asset
Can any of the company-specific risk be diversified away by investing in both Naver and Mirae Asset 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 Naver and Mirae Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Naver and Mirae Asset Daewoo, you can compare the effects of market volatilities on Naver and Mirae Asset 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 Naver with a short position of Mirae Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Naver and Mirae Asset.
Diversification Opportunities for Naver and Mirae Asset
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Naver and Mirae is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Naver and Mirae Asset Daewoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirae Asset Daewoo and Naver 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 Naver are associated (or correlated) with Mirae Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirae Asset Daewoo has no effect on the direction of Naver i.e., Naver and Mirae Asset go up and down completely randomly.
Pair Corralation between Naver and Mirae Asset
Assuming the 90 days trading horizon Naver is expected to generate 0.65 times more return on investment than Mirae Asset. However, Naver is 1.53 times less risky than Mirae Asset. It trades about 0.12 of its potential returns per unit of risk. Mirae Asset Daewoo is currently generating about 0.04 per unit of risk. If you would invest 15,902,000 in Naver on December 4, 2024 and sell it today you would earn a total of 4,798,000 from holding Naver or generate 30.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Naver vs. Mirae Asset Daewoo
Performance |
| Timeline |
| Naver |
| Mirae Asset Daewoo |
Naver and Mirae Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Naver and Mirae Asset
The main advantage of trading using opposite Naver and Mirae Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Naver position performs unexpectedly, Mirae Asset 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 Mirae Asset will offset losses from the drop in Mirae Asset's long position.| Naver vs. E Investment Development | Naver vs. Stic Investments | Naver vs. Mgame Corp | Naver vs. Golden Bridge Investment |
| Mirae Asset vs. Worldex Industry Trading | Mirae Asset vs. Daiyang Metal Co | Mirae Asset vs. Polaris Office Corp | Mirae Asset vs. Samyung Trading 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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