Correlation Between Korea Aerospace and EyeGene
Can any of the company-specific risk be diversified away by investing in both Korea Aerospace and EyeGene 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 Korea Aerospace and EyeGene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Aerospace Industries and EyeGene, you can compare the effects of market volatilities on Korea Aerospace and EyeGene 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 Korea Aerospace with a short position of EyeGene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Aerospace and EyeGene.
Diversification Opportunities for Korea Aerospace and EyeGene
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Korea and EyeGene is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Korea Aerospace Industries and EyeGene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EyeGene and Korea Aerospace 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 Korea Aerospace Industries are associated (or correlated) with EyeGene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EyeGene has no effect on the direction of Korea Aerospace i.e., Korea Aerospace and EyeGene go up and down completely randomly.
Pair Corralation between Korea Aerospace and EyeGene
Assuming the 90 days trading horizon Korea Aerospace Industries is expected to generate 1.67 times more return on investment than EyeGene. However, Korea Aerospace is 1.67 times more volatile than EyeGene. It trades about 0.03 of its potential returns per unit of risk. EyeGene is currently generating about -0.03 per unit of risk. If you would invest 5,760,000 in Korea Aerospace Industries on September 2, 2024 and sell it today you would earn a total of 80,000 from holding Korea Aerospace Industries or generate 1.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Aerospace Industries vs. EyeGene
Performance |
| Timeline |
| Korea Aerospace Indu |
| EyeGene |
Korea Aerospace and EyeGene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Aerospace and EyeGene
The main advantage of trading using opposite Korea Aerospace and EyeGene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Aerospace position performs unexpectedly, EyeGene 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 EyeGene will offset losses from the drop in EyeGene's long position.| Korea Aerospace vs. Korea New Network | Korea Aerospace vs. ICD Co | Korea Aerospace vs. DYPNF CoLtd | Korea Aerospace vs. Busan Industrial Co |
| EyeGene vs. CJ Seafood Corp | EyeGene vs. Chorokbaem Healthcare Co | EyeGene vs. Shinsegae Food | EyeGene vs. InnoTherapy |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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