Correlation Between Koryo Credit and Narae Nanotech
Can any of the company-specific risk be diversified away by investing in both Koryo Credit and Narae Nanotech 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 Narae Nanotech 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 Narae Nanotech Corp, you can compare the effects of market volatilities on Koryo Credit and Narae Nanotech 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 Narae Nanotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koryo Credit and Narae Nanotech.
Diversification Opportunities for Koryo Credit and Narae Nanotech
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Koryo and Narae is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and Narae Nanotech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Narae Nanotech Corp 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 Narae Nanotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Narae Nanotech Corp has no effect on the direction of Koryo Credit i.e., Koryo Credit and Narae Nanotech go up and down completely randomly.
Pair Corralation between Koryo Credit and Narae Nanotech
Assuming the 90 days trading horizon Koryo Credit Information is expected to generate 0.2 times more return on investment than Narae Nanotech. However, Koryo Credit Information is 5.07 times less risky than Narae Nanotech. It trades about -0.24 of its potential returns per unit of risk. Narae Nanotech Corp is currently generating about -0.59 per unit of risk. If you would invest 1,012,154 in Koryo Credit Information on October 25, 2024 and sell it today you would lose (30,154) from holding Koryo Credit Information or give up 2.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koryo Credit Information vs. Narae Nanotech Corp
Performance |
| Timeline |
| Koryo Credit Information |
| Narae Nanotech Corp |
Koryo Credit and Narae Nanotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koryo Credit and Narae Nanotech
The main advantage of trading using opposite Koryo Credit and Narae Nanotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koryo Credit position performs unexpectedly, Narae Nanotech 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 Narae Nanotech will offset losses from the drop in Narae Nanotech's long position.| Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. KB Financial Group | Koryo Credit vs. Shinhan Financial Group |
| Narae Nanotech vs. Wireless Power Amplifier | Narae Nanotech vs. Koryo Credit Information | Narae Nanotech vs. Sewoon Medical Co | Narae Nanotech vs. Digital Power Communications |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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