Correlation Between Osang Healthcare and RFTech
Can any of the company-specific risk be diversified away by investing in both Osang Healthcare and RFTech 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 Osang Healthcare and RFTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Osang Healthcare Co,Ltd and RFTech Co, you can compare the effects of market volatilities on Osang Healthcare and RFTech 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 Osang Healthcare with a short position of RFTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osang Healthcare and RFTech.
Diversification Opportunities for Osang Healthcare and RFTech
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Osang and RFTech is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Osang Healthcare Co,Ltd and RFTech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RFTech and Osang Healthcare 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 Osang Healthcare Co,Ltd are associated (or correlated) with RFTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RFTech has no effect on the direction of Osang Healthcare i.e., Osang Healthcare and RFTech go up and down completely randomly.
Pair Corralation between Osang Healthcare and RFTech
Assuming the 90 days trading horizon Osang Healthcare Co,Ltd is expected to generate 1.4 times more return on investment than RFTech. However, Osang Healthcare is 1.4 times more volatile than RFTech Co. It trades about -0.03 of its potential returns per unit of risk. RFTech Co is currently generating about -0.34 per unit of risk. If you would invest 1,482,000 in Osang Healthcare Co,Ltd on December 1, 2024 and sell it today you would lose (30,000) from holding Osang Healthcare Co,Ltd or give up 2.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Osang Healthcare Co,Ltd vs. RFTech Co
Performance |
| Timeline |
| Osang Healthcare Co,Ltd |
| RFTech |
Osang Healthcare and RFTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Osang Healthcare and RFTech
The main advantage of trading using opposite Osang Healthcare and RFTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osang Healthcare position performs unexpectedly, RFTech 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 RFTech will offset losses from the drop in RFTech's long position.| Osang Healthcare vs. Daishin Information Communications | Osang Healthcare vs. Samyoung Electronics Co | Osang Healthcare vs. Sam Yang Foods | Osang Healthcare vs. Lotte Chilsung Beverage |
| RFTech vs. Seoyon Topmetal Co | RFTech vs. Insung Information Co | RFTech vs. SCI Information Service | RFTech vs. LEENO Industrial |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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