Correlation Between Woori Technology and Wonbang Tech
Can any of the company-specific risk be diversified away by investing in both Woori Technology and Wonbang Tech 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 Woori Technology and Wonbang Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Technology Investment and Wonbang Tech Co, you can compare the effects of market volatilities on Woori Technology and Wonbang Tech 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 Woori Technology with a short position of Wonbang Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and Wonbang Tech.
Diversification Opportunities for Woori Technology and Wonbang Tech
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Woori and Wonbang is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology Investment and Wonbang Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonbang Tech and Woori Technology 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 Woori Technology Investment are associated (or correlated) with Wonbang Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonbang Tech has no effect on the direction of Woori Technology i.e., Woori Technology and Wonbang Tech go up and down completely randomly.
Pair Corralation between Woori Technology and Wonbang Tech
Assuming the 90 days trading horizon Woori Technology Investment is expected to generate 1.04 times more return on investment than Wonbang Tech. However, Woori Technology is 1.04 times more volatile than Wonbang Tech Co. It trades about 0.04 of its potential returns per unit of risk. Wonbang Tech Co is currently generating about -0.04 per unit of risk. If you would invest 858,000 in Woori Technology Investment on August 28, 2024 and sell it today you would earn a total of 92,000 from holding Woori Technology Investment or generate 10.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Technology Investment vs. Wonbang Tech Co
Performance |
| Timeline |
| Woori Technology Inv |
| Wonbang Tech |
Woori Technology and Wonbang Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and Wonbang Tech
The main advantage of trading using opposite Woori Technology and Wonbang Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology position performs unexpectedly, Wonbang Tech 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 Wonbang Tech will offset losses from the drop in Wonbang Tech's long position.| Woori Technology vs. Humasis Co | Woori Technology vs. JUSUNG ENGINEERING Co | Woori Technology vs. Winix Inc | Woori Technology vs. AfreecaTV Co |
| Wonbang Tech vs. Namhwa Industrial Co | Wonbang Tech vs. Youngsin Metal Industrial | Wonbang Tech vs. Daedong Metals Co | Wonbang Tech vs. Kukil 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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