Correlation Between Koryo Credit and Pungguk Ethanol
Can any of the company-specific risk be diversified away by investing in both Koryo Credit and Pungguk Ethanol 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 Koryo Credit and Pungguk Ethanol into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koryo Credit Information and Pungguk Ethanol Industrial, you can compare the effects of market volatilities on Koryo Credit and Pungguk Ethanol 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 Koryo Credit with a short position of Pungguk Ethanol. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koryo Credit and Pungguk Ethanol.
Diversification Opportunities for Koryo Credit and Pungguk Ethanol
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Koryo and Pungguk is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and Pungguk Ethanol Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pungguk Ethanol Indu and Koryo Credit 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 Koryo Credit Information are associated (or correlated) with Pungguk Ethanol. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pungguk Ethanol Indu has no effect on the direction of Koryo Credit i.e., Koryo Credit and Pungguk Ethanol go up and down completely randomly.
Pair Corralation between Koryo Credit and Pungguk Ethanol
Assuming the 90 days trading horizon Koryo Credit Information is expected to generate 0.7 times more return on investment than Pungguk Ethanol. However, Koryo Credit Information is 1.43 times less risky than Pungguk Ethanol. It trades about 0.01 of its potential returns per unit of risk. Pungguk Ethanol Industrial is currently generating about -0.03 per unit of risk. If you would invest 1,010,436 in Koryo Credit Information on September 4, 2024 and sell it today you would earn a total of 26,564 from holding Koryo Credit Information or generate 2.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koryo Credit Information vs. Pungguk Ethanol Industrial
Performance |
| Timeline |
| Koryo Credit Information |
| Pungguk Ethanol Indu |
Koryo Credit and Pungguk Ethanol Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koryo Credit and Pungguk Ethanol
The main advantage of trading using opposite Koryo Credit and Pungguk Ethanol positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koryo Credit position performs unexpectedly, Pungguk Ethanol 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 Pungguk Ethanol will offset losses from the drop in Pungguk Ethanol's long position.| Koryo Credit vs. LG Display | Koryo Credit vs. Hyundai Motor | Koryo Credit vs. Hyundai Motor Co | Koryo Credit vs. Hyundai Motor Co |
| Pungguk Ethanol vs. Tae Kyung Chemical | Pungguk Ethanol vs. Kukdong Oil Chemicals | Pungguk Ethanol vs. Miwon Chemical | Pungguk Ethanol vs. Daehan Synthetic Fiber |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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