Correlation Between InBody CoLtd and Finebesteel
Can any of the company-specific risk be diversified away by investing in both InBody CoLtd and Finebesteel 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 InBody CoLtd and Finebesteel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InBody CoLtd and Finebesteel, you can compare the effects of market volatilities on InBody CoLtd and Finebesteel 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 InBody CoLtd with a short position of Finebesteel. Check out your portfolio center. Please also check ongoing floating volatility patterns of InBody CoLtd and Finebesteel.
Diversification Opportunities for InBody CoLtd and Finebesteel
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between InBody and Finebesteel is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding InBody CoLtd and Finebesteel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finebesteel and InBody CoLtd 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 InBody CoLtd are associated (or correlated) with Finebesteel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finebesteel has no effect on the direction of InBody CoLtd i.e., InBody CoLtd and Finebesteel go up and down completely randomly.
Pair Corralation between InBody CoLtd and Finebesteel
Assuming the 90 days trading horizon InBody CoLtd is expected to generate 2.56 times less return on investment than Finebesteel. But when comparing it to its historical volatility, InBody CoLtd is 1.45 times less risky than Finebesteel. It trades about 0.18 of its potential returns per unit of risk. Finebesteel is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 93,100 in Finebesteel on October 26, 2024 and sell it today you would earn a total of 16,900 from holding Finebesteel or generate 18.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
InBody CoLtd vs. Finebesteel
Performance |
| Timeline |
| InBody CoLtd |
| Finebesteel |
InBody CoLtd and Finebesteel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InBody CoLtd and Finebesteel
The main advantage of trading using opposite InBody CoLtd and Finebesteel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InBody CoLtd position performs unexpectedly, Finebesteel 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 Finebesteel will offset losses from the drop in Finebesteel's long position.| InBody CoLtd vs. Vieworks Co | InBody CoLtd vs. Genie Music | InBody CoLtd vs. Seegene | InBody CoLtd vs. Medy Tox |
| Finebesteel vs. Youngchang Chemical Co | Finebesteel vs. LG Display Co | Finebesteel vs. Kyung In Synthetic Corp | Finebesteel vs. Alton Sports CoLtd |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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