Correlation Between LG Chemicals and ED
Can any of the company-specific risk be diversified away by investing in both LG Chemicals and ED 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 LG Chemicals and ED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LG Chemicals and ED Co, you can compare the effects of market volatilities on LG Chemicals and ED 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 LG Chemicals with a short position of ED. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG Chemicals and ED.
Diversification Opportunities for LG Chemicals and ED
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 051910 and ED is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding LG Chemicals and ED Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ED Co and LG Chemicals 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 LG Chemicals are associated (or correlated) with ED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ED Co has no effect on the direction of LG Chemicals i.e., LG Chemicals and ED go up and down completely randomly.
Pair Corralation between LG Chemicals and ED
If you would invest 0.00 in ED Co on October 24, 2024 and sell it today you would earn a total of 0.00 from holding ED Co or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 1.25% |
| Values | Daily Returns |
LG Chemicals vs. ED Co
Performance |
| Timeline |
| LG Chemicals |
| ED Co |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
LG Chemicals and ED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LG Chemicals and ED
The main advantage of trading using opposite LG Chemicals and ED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG Chemicals position performs unexpectedly, ED 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 ED will offset losses from the drop in ED's long position.| LG Chemicals vs. KT Submarine Telecom | LG Chemicals vs. GS Retail Co | LG Chemicals vs. Pan Entertainment Co | LG Chemicals vs. MEDIANA CoLtd |
| ED vs. DataSolution | ED vs. LG Household Healthcare | ED vs. Insung Information Co | ED vs. NICE Information Service |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |