Correlation Between Koryo Credit and TOPMATERIAL
Can any of the company-specific risk be diversified away by investing in both Koryo Credit and TOPMATERIAL 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 TOPMATERIAL 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 TOPMATERIAL LTD, you can compare the effects of market volatilities on Koryo Credit and TOPMATERIAL 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 TOPMATERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koryo Credit and TOPMATERIAL.
Diversification Opportunities for Koryo Credit and TOPMATERIAL
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Koryo and TOPMATERIAL is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and TOPMATERIAL LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOPMATERIAL LTD 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 TOPMATERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOPMATERIAL LTD has no effect on the direction of Koryo Credit i.e., Koryo Credit and TOPMATERIAL go up and down completely randomly.
Pair Corralation between Koryo Credit and TOPMATERIAL
Assuming the 90 days trading horizon Koryo Credit is expected to generate 7.53 times less return on investment than TOPMATERIAL. But when comparing it to its historical volatility, Koryo Credit Information is 3.12 times less risky than TOPMATERIAL. It trades about 0.01 of its potential returns per unit of risk. TOPMATERIAL LTD is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 3,040,000 in TOPMATERIAL LTD on September 20, 2024 and sell it today you would lose (255,000) from holding TOPMATERIAL LTD or give up 8.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koryo Credit Information vs. TOPMATERIAL LTD
Performance |
| Timeline |
| Koryo Credit Information |
| TOPMATERIAL LTD |
Koryo Credit and TOPMATERIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koryo Credit and TOPMATERIAL
The main advantage of trading using opposite Koryo Credit and TOPMATERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koryo Credit position performs unexpectedly, TOPMATERIAL 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 TOPMATERIAL will offset losses from the drop in TOPMATERIAL's long position.| Koryo Credit vs. Woorim Machinery Co | Koryo Credit vs. Lotte Data Communication | Koryo Credit vs. Hanshin Construction Co | Koryo Credit vs. Dongkuk Structures Construction |
| TOPMATERIAL vs. Wave Electronics Co | TOPMATERIAL vs. Anam Electronics Co | TOPMATERIAL vs. Koryo Credit Information | TOPMATERIAL vs. DB Insurance 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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