Correlation Between Polaris Office and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both Polaris Office and Kukil Metal 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 Kukil Metal 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 Kukil Metal Co, you can compare the effects of market volatilities on Polaris Office and Kukil Metal 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 Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polaris Office and Kukil Metal.
Diversification Opportunities for Polaris Office and Kukil Metal
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Polaris and Kukil is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Polaris Office Corp and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal 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 Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of Polaris Office i.e., Polaris Office and Kukil Metal go up and down completely randomly.
Pair Corralation between Polaris Office and Kukil Metal
Assuming the 90 days trading horizon Polaris Office Corp is expected to generate 2.62 times more return on investment than Kukil Metal. However, Polaris Office is 2.62 times more volatile than Kukil Metal Co. It trades about 0.1 of its potential returns per unit of risk. Kukil Metal Co is currently generating about -0.01 per unit of risk. If you would invest 549,000 in Polaris Office Corp on September 20, 2024 and sell it today you would earn a total of 50,000 from holding Polaris Office Corp or generate 9.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polaris Office Corp vs. Kukil Metal Co
Performance |
| Timeline |
| Polaris Office Corp |
| Kukil Metal |
Polaris Office and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polaris Office and Kukil Metal
The main advantage of trading using opposite Polaris Office and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polaris Office position performs unexpectedly, Kukil Metal 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| Polaris Office vs. Adaptive Plasma Technology | Polaris Office vs. Samsung Publishing Co | Polaris Office vs. Neungyule Education | Polaris Office vs. Hanjin Transportation Co |
| Kukil Metal vs. Eugene Technology CoLtd | Kukil Metal vs. Koh Young Technology | Kukil Metal vs. Kbi Metal Co | Kukil Metal vs. Global Standard Technology |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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