Correlation Between Woori Technology and Chorokbaem Healthcare
Can any of the company-specific risk be diversified away by investing in both Woori Technology and Chorokbaem Healthcare 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 Chorokbaem Healthcare 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 Chorokbaem Healthcare Co, you can compare the effects of market volatilities on Woori Technology and Chorokbaem Healthcare 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 Chorokbaem Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and Chorokbaem Healthcare.
Diversification Opportunities for Woori Technology and Chorokbaem Healthcare
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Woori and Chorokbaem is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology Investment and Chorokbaem Healthcare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chorokbaem Healthcare 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 Chorokbaem Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chorokbaem Healthcare has no effect on the direction of Woori Technology i.e., Woori Technology and Chorokbaem Healthcare go up and down completely randomly.
Pair Corralation between Woori Technology and Chorokbaem Healthcare
Assuming the 90 days trading horizon Woori Technology Investment is expected to generate 2.13 times more return on investment than Chorokbaem Healthcare. However, Woori Technology is 2.13 times more volatile than Chorokbaem Healthcare Co. It trades about 0.06 of its potential returns per unit of risk. Chorokbaem Healthcare Co is currently generating about -0.06 per unit of risk. If you would invest 668,000 in Woori Technology Investment on September 4, 2024 and sell it today you would earn a total of 320,000 from holding Woori Technology Investment or generate 47.9% 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. Chorokbaem Healthcare Co
Performance |
| Timeline |
| Woori Technology Inv |
| Chorokbaem Healthcare |
Woori Technology and Chorokbaem Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and Chorokbaem Healthcare
The main advantage of trading using opposite Woori Technology and Chorokbaem Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology position performs unexpectedly, Chorokbaem Healthcare 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 Chorokbaem Healthcare will offset losses from the drop in Chorokbaem Healthcare's long position.| Woori Technology vs. Dongjin Semichem Co | Woori Technology vs. AhnLab Inc | Woori Technology vs. Posco ICT | Woori Technology vs. CJ ENM |
| Chorokbaem Healthcare vs. AptaBio Therapeutics | Chorokbaem Healthcare vs. KT Hitel | Chorokbaem Healthcare vs. SillaJen | Chorokbaem Healthcare vs. Cytogen |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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