Correlation Between Eagle Veterinary and Woori Technology
Can any of the company-specific risk be diversified away by investing in both Eagle Veterinary and Woori Technology 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 Eagle Veterinary and Woori Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Veterinary Technology and Woori Technology, you can compare the effects of market volatilities on Eagle Veterinary and Woori Technology 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 Eagle Veterinary with a short position of Woori Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Veterinary and Woori Technology.
Diversification Opportunities for Eagle Veterinary and Woori Technology
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eagle and Woori is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Veterinary Technology and Woori Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woori Technology and Eagle Veterinary 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 Eagle Veterinary Technology are associated (or correlated) with Woori Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woori Technology has no effect on the direction of Eagle Veterinary i.e., Eagle Veterinary and Woori Technology go up and down completely randomly.
Pair Corralation between Eagle Veterinary and Woori Technology
Assuming the 90 days trading horizon Eagle Veterinary Technology is expected to under-perform the Woori Technology. But the stock apears to be less risky and, when comparing its historical volatility, Eagle Veterinary Technology is 1.88 times less risky than Woori Technology. The stock trades about -0.1 of its potential returns per unit of risk. The Woori Technology is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 231,500 in Woori Technology on August 25, 2024 and sell it today you would earn a total of 6,000 from holding Woori Technology or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eagle Veterinary Technology vs. Woori Technology
Performance |
| Timeline |
| Eagle Veterinary Tec |
| Woori Technology |
Eagle Veterinary and Woori Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eagle Veterinary and Woori Technology
The main advantage of trading using opposite Eagle Veterinary and Woori Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Veterinary position performs unexpectedly, Woori Technology 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 Woori Technology will offset losses from the drop in Woori Technology's long position.| Eagle Veterinary vs. Kolon Life Science | Eagle Veterinary vs. JETEMA Co | Eagle Veterinary vs. Aminologics CoLtd | Eagle Veterinary vs. Daihan Pharmaceutical CoLtd |
| Woori Technology vs. Shinsung Delta Tech | Woori Technology vs. Sungchang Autotech Co | Woori Technology vs. DAEDUCK ELECTRONICS CoLtd | Woori Technology vs. PH Tech 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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