Correlation Between Polaris Office and Iljin Display
Can any of the company-specific risk be diversified away by investing in both Polaris Office and Iljin Display 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 Polaris Office and Iljin Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polaris Office Corp and Iljin Display, you can compare the effects of market volatilities on Polaris Office and Iljin Display 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 Polaris Office with a short position of Iljin Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polaris Office and Iljin Display.
Diversification Opportunities for Polaris Office and Iljin Display
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Polaris and Iljin is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Polaris Office Corp and Iljin Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iljin Display and Polaris Office 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 Polaris Office Corp are associated (or correlated) with Iljin Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iljin Display has no effect on the direction of Polaris Office i.e., Polaris Office and Iljin Display go up and down completely randomly.
Pair Corralation between Polaris Office and Iljin Display
Assuming the 90 days trading horizon Polaris Office Corp is expected to under-perform the Iljin Display. In addition to that, Polaris Office is 1.45 times more volatile than Iljin Display. It trades about -0.06 of its total potential returns per unit of risk. Iljin Display is currently generating about 0.07 per unit of volatility. If you would invest 86,500 in Iljin Display on November 6, 2024 and sell it today you would earn a total of 1,800 from holding Iljin Display or generate 2.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polaris Office Corp vs. Iljin Display
Performance |
| Timeline |
| Polaris Office Corp |
| Iljin Display |
Polaris Office and Iljin Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polaris Office and Iljin Display
The main advantage of trading using opposite Polaris Office and Iljin Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polaris Office position performs unexpectedly, Iljin Display 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 Iljin Display will offset losses from the drop in Iljin Display's long position.| Polaris Office vs. Hwangkum Steel Technology | Polaris Office vs. Jeju Beer Co | Polaris Office vs. Woori Technology | Polaris Office vs. Dong A Steel Technology |
| Iljin Display vs. INFINITT Healthcare Co | Iljin Display vs. NewFlex Technology Co | Iljin Display vs. LG Household Healthcare | Iljin Display vs. Youngsin Metal 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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