Correlation Between KT Hitel and JC Chemical
Can any of the company-specific risk be diversified away by investing in both KT Hitel and JC Chemical 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 KT Hitel and JC Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KT Hitel and JC Chemical Co, you can compare the effects of market volatilities on KT Hitel and JC Chemical 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 KT Hitel with a short position of JC Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of KT Hitel and JC Chemical.
Diversification Opportunities for KT Hitel and JC Chemical
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 036030 and 137950 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding KT Hitel and JC Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JC Chemical and KT Hitel 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 KT Hitel are associated (or correlated) with JC Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JC Chemical has no effect on the direction of KT Hitel i.e., KT Hitel and JC Chemical go up and down completely randomly.
Pair Corralation between KT Hitel and JC Chemical
Assuming the 90 days trading horizon KT Hitel is expected to generate 0.6 times more return on investment than JC Chemical. However, KT Hitel is 1.67 times less risky than JC Chemical. It trades about -0.05 of its potential returns per unit of risk. JC Chemical Co is currently generating about -0.32 per unit of risk. If you would invest 353,000 in KT Hitel on November 3, 2024 and sell it today you would lose (3,500) from holding KT Hitel or give up 0.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KT Hitel vs. JC Chemical Co
Performance |
| Timeline |
| KT Hitel |
| JC Chemical |
KT Hitel and JC Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KT Hitel and JC Chemical
The main advantage of trading using opposite KT Hitel and JC Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KT Hitel position performs unexpectedly, JC Chemical 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 JC Chemical will offset losses from the drop in JC Chemical's long position.| KT Hitel vs. DB Financial Investment | KT Hitel vs. E Investment Development | KT Hitel vs. BGF Retail Co | KT Hitel vs. GS Retail Co |
| JC Chemical vs. Sangsangin Investment Securities | JC Chemical vs. Stic Investments | JC Chemical vs. Inzi Display CoLtd | JC Chemical vs. PLAYWITH |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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