Correlation Between Kisan Telecom and Cosmecca Korea
Can any of the company-specific risk be diversified away by investing in both Kisan Telecom and Cosmecca Korea 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 Kisan Telecom and Cosmecca Korea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kisan Telecom Co and Cosmecca Korea Co, you can compare the effects of market volatilities on Kisan Telecom and Cosmecca Korea 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 Kisan Telecom with a short position of Cosmecca Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kisan Telecom and Cosmecca Korea.
Diversification Opportunities for Kisan Telecom and Cosmecca Korea
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kisan and Cosmecca is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Kisan Telecom Co and Cosmecca Korea Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmecca Korea and Kisan Telecom 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 Kisan Telecom Co are associated (or correlated) with Cosmecca Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmecca Korea has no effect on the direction of Kisan Telecom i.e., Kisan Telecom and Cosmecca Korea go up and down completely randomly.
Pair Corralation between Kisan Telecom and Cosmecca Korea
Assuming the 90 days trading horizon Kisan Telecom Co is expected to generate 0.5 times more return on investment than Cosmecca Korea. However, Kisan Telecom Co is 1.99 times less risky than Cosmecca Korea. It trades about -0.07 of its potential returns per unit of risk. Cosmecca Korea Co is currently generating about -0.04 per unit of risk. If you would invest 212,000 in Kisan Telecom Co on September 14, 2024 and sell it today you would lose (39,000) from holding Kisan Telecom Co or give up 18.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kisan Telecom Co vs. Cosmecca Korea Co
Performance |
| Timeline |
| Kisan Telecom |
| Cosmecca Korea |
Kisan Telecom and Cosmecca Korea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kisan Telecom and Cosmecca Korea
The main advantage of trading using opposite Kisan Telecom and Cosmecca Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kisan Telecom position performs unexpectedly, Cosmecca Korea 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 Cosmecca Korea will offset losses from the drop in Cosmecca Korea's long position.| Kisan Telecom vs. Dongbu Steel Co | Kisan Telecom vs. Histeel | Kisan Telecom vs. Moonbae Steel | Kisan Telecom vs. Polaris Office Corp |
| Cosmecca Korea vs. Kisan Telecom Co | Cosmecca Korea vs. BooKook Steel Co | Cosmecca Korea vs. Samhyun Steel Co | Cosmecca Korea vs. Handok Clean Tech |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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