Correlation Between Ecoplastic and Korea Information
Can any of the company-specific risk be diversified away by investing in both Ecoplastic and Korea Information 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 Ecoplastic and Korea Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecoplastic and Korea Information Communications, you can compare the effects of market volatilities on Ecoplastic and Korea Information 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 Ecoplastic with a short position of Korea Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecoplastic and Korea Information.
Diversification Opportunities for Ecoplastic and Korea Information
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ecoplastic and Korea is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Ecoplastic and Korea Information Communicatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Information and Ecoplastic 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 Ecoplastic are associated (or correlated) with Korea Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Information has no effect on the direction of Ecoplastic i.e., Ecoplastic and Korea Information go up and down completely randomly.
Pair Corralation between Ecoplastic and Korea Information
Assuming the 90 days trading horizon Ecoplastic is expected to under-perform the Korea Information. In addition to that, Ecoplastic is 2.09 times more volatile than Korea Information Communications. It trades about -0.23 of its total potential returns per unit of risk. Korea Information Communications is currently generating about 0.06 per unit of volatility. If you would invest 811,000 in Korea Information Communications on August 29, 2024 and sell it today you would earn a total of 9,000 from holding Korea Information Communications or generate 1.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ecoplastic vs. Korea Information Communicatio
Performance |
| Timeline |
| Ecoplastic |
| Korea Information |
Ecoplastic and Korea Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecoplastic and Korea Information
The main advantage of trading using opposite Ecoplastic and Korea Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecoplastic position performs unexpectedly, Korea Information 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 Korea Information will offset losses from the drop in Korea Information's long position.| Ecoplastic vs. KMH Hitech Co | Ecoplastic vs. GemVaxKAEL CoLtd | Ecoplastic vs. Busan Industrial Co | Ecoplastic vs. Busan Ind |
| Korea Information vs. Daejung Chemicals Metals | Korea Information vs. KyungIn Electronics Co | Korea Information vs. PJ Metal Co | Korea Information vs. Dongwon Metal 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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