Correlation Between Nice Information and Lotte Fine
Can any of the company-specific risk be diversified away by investing in both Nice Information and Lotte Fine 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 Nice Information and Lotte Fine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nice Information Telecommunication and Lotte Fine Chemical, you can compare the effects of market volatilities on Nice Information and Lotte Fine 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 Nice Information with a short position of Lotte Fine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nice Information and Lotte Fine.
Diversification Opportunities for Nice Information and Lotte Fine
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Nice and Lotte is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Nice Information Telecommunica and Lotte Fine Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Fine Chemical and Nice Information 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 Nice Information Telecommunication are associated (or correlated) with Lotte Fine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Fine Chemical has no effect on the direction of Nice Information i.e., Nice Information and Lotte Fine go up and down completely randomly.
Pair Corralation between Nice Information and Lotte Fine
Assuming the 90 days trading horizon Nice Information Telecommunication is expected to under-perform the Lotte Fine. But the stock apears to be less risky and, when comparing its historical volatility, Nice Information Telecommunication is 1.91 times less risky than Lotte Fine. The stock trades about -0.36 of its potential returns per unit of risk. The Lotte Fine Chemical is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 4,070,000 in Lotte Fine Chemical on November 4, 2024 and sell it today you would lose (100,000) from holding Lotte Fine Chemical or give up 2.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nice Information Telecommunica vs. Lotte Fine Chemical
Performance |
| Timeline |
| Nice Information Tel |
| Lotte Fine Chemical |
Nice Information and Lotte Fine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nice Information and Lotte Fine
The main advantage of trading using opposite Nice Information and Lotte Fine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nice Information position performs unexpectedly, Lotte Fine 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 Lotte Fine will offset losses from the drop in Lotte Fine's long position.| Nice Information vs. Soulbrain Holdings Co | Nice Information vs. NICE Total Cash | Nice Information vs. Geumhwa Plant Service | Nice Information vs. AfreecaTV Co |
| Lotte Fine vs. Insun Environment New | Lotte Fine vs. BooKook Steel Co | Lotte Fine vs. Hankukpackage Co | Lotte Fine vs. Lotte Non Life Insurance |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |