Correlation Between JYP Entertainment and INNOX Advanced
Can any of the company-specific risk be diversified away by investing in both JYP Entertainment and INNOX Advanced 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 JYP Entertainment and INNOX Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JYP Entertainment Corp and INNOX Advanced Materials, you can compare the effects of market volatilities on JYP Entertainment and INNOX Advanced 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 JYP Entertainment with a short position of INNOX Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of JYP Entertainment and INNOX Advanced.
Diversification Opportunities for JYP Entertainment and INNOX Advanced
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JYP and INNOX is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding JYP Entertainment Corp and INNOX Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INNOX Advanced Materials and JYP Entertainment 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 JYP Entertainment Corp are associated (or correlated) with INNOX Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INNOX Advanced Materials has no effect on the direction of JYP Entertainment i.e., JYP Entertainment and INNOX Advanced go up and down completely randomly.
Pair Corralation between JYP Entertainment and INNOX Advanced
Assuming the 90 days trading horizon JYP Entertainment Corp is expected to generate 0.57 times more return on investment than INNOX Advanced. However, JYP Entertainment Corp is 1.74 times less risky than INNOX Advanced. It trades about 0.21 of its potential returns per unit of risk. INNOX Advanced Materials is currently generating about 0.1 per unit of risk. If you would invest 7,500,000 in JYP Entertainment Corp on November 27, 2024 and sell it today you would earn a total of 640,000 from holding JYP Entertainment Corp or generate 8.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JYP Entertainment Corp vs. INNOX Advanced Materials
Performance |
| Timeline |
| JYP Entertainment Corp |
| INNOX Advanced Materials |
JYP Entertainment and INNOX Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JYP Entertainment and INNOX Advanced
The main advantage of trading using opposite JYP Entertainment and INNOX Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JYP Entertainment position performs unexpectedly, INNOX Advanced 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 INNOX Advanced will offset losses from the drop in INNOX Advanced's long position.| JYP Entertainment vs. KPX Green Chemical | JYP Entertainment vs. Hironic Co | JYP Entertainment vs. Fine Besteel Co | JYP Entertainment vs. SK Chemicals Co |
| INNOX Advanced vs. Neungyule Education | INNOX Advanced vs. Korea Information Engineering | INNOX Advanced vs. Hanwha InvestmentSecurities Co | INNOX Advanced vs. DB Financial Investment |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |