Correlation Between ICD and Bosung Power
Can any of the company-specific risk be diversified away by investing in both ICD and Bosung Power 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 ICD and Bosung Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICD Co and Bosung Power Technology, you can compare the effects of market volatilities on ICD and Bosung Power 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 ICD with a short position of Bosung Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICD and Bosung Power.
Diversification Opportunities for ICD and Bosung Power
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ICD and Bosung is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding ICD Co and Bosung Power Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bosung Power Technology and ICD 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 ICD Co are associated (or correlated) with Bosung Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bosung Power Technology has no effect on the direction of ICD i.e., ICD and Bosung Power go up and down completely randomly.
Pair Corralation between ICD and Bosung Power
Assuming the 90 days trading horizon ICD Co is expected to generate 1.69 times more return on investment than Bosung Power. However, ICD is 1.69 times more volatile than Bosung Power Technology. It trades about 0.08 of its potential returns per unit of risk. Bosung Power Technology is currently generating about -0.14 per unit of risk. If you would invest 477,500 in ICD Co on September 3, 2024 and sell it today you would earn a total of 18,500 from holding ICD Co or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ICD Co vs. Bosung Power Technology
Performance |
| Timeline |
| ICD Co |
| Bosung Power Technology |
ICD and Bosung Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICD and Bosung Power
The main advantage of trading using opposite ICD and Bosung Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICD position performs unexpectedly, Bosung Power 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 Bosung Power will offset losses from the drop in Bosung Power's long position.| ICD vs. SFA Engineering | ICD vs. APS Holdings | ICD vs. Soulbrain Holdings Co | ICD vs. JUSUNG ENGINEERING Co |
| Bosung Power vs. LG Display | Bosung Power vs. Hyundai Motor | Bosung Power vs. Hyundai Motor Co | Bosung Power vs. Hyundai Motor 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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