Correlation Between JYP Entertainment and GiantStep
Can any of the company-specific risk be diversified away by investing in both JYP Entertainment and GiantStep 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 GiantStep into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JYP Entertainment and GiantStep Co, you can compare the effects of market volatilities on JYP Entertainment and GiantStep 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 GiantStep. Check out your portfolio center. Please also check ongoing floating volatility patterns of JYP Entertainment and GiantStep.
Diversification Opportunities for JYP Entertainment and GiantStep
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JYP and GiantStep is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding JYP Entertainment and GiantStep Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GiantStep 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 are associated (or correlated) with GiantStep. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GiantStep has no effect on the direction of JYP Entertainment i.e., JYP Entertainment and GiantStep go up and down completely randomly.
Pair Corralation between JYP Entertainment and GiantStep
Assuming the 90 days trading horizon JYP Entertainment is expected to generate 0.62 times more return on investment than GiantStep. However, JYP Entertainment is 1.61 times less risky than GiantStep. It trades about 0.15 of its potential returns per unit of risk. GiantStep Co is currently generating about 0.0 per unit of risk. If you would invest 4,954,274 in JYP Entertainment on November 2, 2024 and sell it today you would earn a total of 2,545,726 from holding JYP Entertainment or generate 51.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JYP Entertainment vs. GiantStep Co
Performance |
| Timeline |
| JYP Entertainment |
| GiantStep |
JYP Entertainment and GiantStep Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JYP Entertainment and GiantStep
The main advantage of trading using opposite JYP Entertainment and GiantStep positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JYP Entertainment position performs unexpectedly, GiantStep 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 GiantStep will offset losses from the drop in GiantStep's long position.| JYP Entertainment vs. YG Entertainment | JYP Entertainment vs. SM Entertainment Co | JYP Entertainment vs. Cube Entertainment |
| GiantStep vs. HYBE Co | GiantStep vs. NH SPAC 8 | GiantStep vs. Wysiwyg Studios Co | GiantStep vs. RaemongRaein 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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