Correlation Between Nice Information and CJ CheilJedang
Can any of the company-specific risk be diversified away by investing in both Nice Information and CJ CheilJedang 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 CJ CheilJedang 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 CJ CheilJedang Corp, you can compare the effects of market volatilities on Nice Information and CJ CheilJedang 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 CJ CheilJedang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nice Information and CJ CheilJedang.
Diversification Opportunities for Nice Information and CJ CheilJedang
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nice and 097955 is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Nice Information Telecommunica and CJ CheilJedang Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CJ CheilJedang Corp 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 CJ CheilJedang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CJ CheilJedang Corp has no effect on the direction of Nice Information i.e., Nice Information and CJ CheilJedang go up and down completely randomly.
Pair Corralation between Nice Information and CJ CheilJedang
Assuming the 90 days trading horizon Nice Information Telecommunication is expected to under-perform the CJ CheilJedang. In addition to that, Nice Information is 1.26 times more volatile than CJ CheilJedang Corp. It trades about -0.04 of its total potential returns per unit of risk. CJ CheilJedang Corp is currently generating about -0.03 per unit of volatility. If you would invest 15,752,000 in CJ CheilJedang Corp on September 3, 2024 and sell it today you would lose (2,672,000) from holding CJ CheilJedang Corp or give up 16.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nice Information Telecommunica vs. CJ CheilJedang Corp
Performance |
| Timeline |
| Nice Information Tel |
| CJ CheilJedang Corp |
Nice Information and CJ CheilJedang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nice Information and CJ CheilJedang
The main advantage of trading using opposite Nice Information and CJ CheilJedang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nice Information position performs unexpectedly, CJ CheilJedang 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 CJ CheilJedang will offset losses from the drop in CJ CheilJedang'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 |
| CJ CheilJedang vs. Korea Information Communications | CJ CheilJedang vs. Nice Information Telecommunication | CJ CheilJedang vs. Alton Sports CoLtd | CJ CheilJedang vs. Kisan Telecom 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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