Correlation Between KEPCO Engineering and Tuksu Engineering
Can any of the company-specific risk be diversified away by investing in both KEPCO Engineering and Tuksu Engineering 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 KEPCO Engineering and Tuksu Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KEPCO Engineering Construction and Tuksu Engineering ConstructionLtd, you can compare the effects of market volatilities on KEPCO Engineering and Tuksu Engineering 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 KEPCO Engineering with a short position of Tuksu Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of KEPCO Engineering and Tuksu Engineering.
Diversification Opportunities for KEPCO Engineering and Tuksu Engineering
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between KEPCO and Tuksu is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding KEPCO Engineering Construction and Tuksu Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tuksu Engineering and KEPCO Engineering 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 KEPCO Engineering Construction are associated (or correlated) with Tuksu Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tuksu Engineering has no effect on the direction of KEPCO Engineering i.e., KEPCO Engineering and Tuksu Engineering go up and down completely randomly.
Pair Corralation between KEPCO Engineering and Tuksu Engineering
Assuming the 90 days trading horizon KEPCO Engineering Construction is expected to generate 0.98 times more return on investment than Tuksu Engineering. However, KEPCO Engineering Construction is 1.02 times less risky than Tuksu Engineering. It trades about 0.02 of its potential returns per unit of risk. Tuksu Engineering ConstructionLtd is currently generating about -0.03 per unit of risk. If you would invest 6,336,664 in KEPCO Engineering Construction on September 3, 2024 and sell it today you would earn a total of 413,336 from holding KEPCO Engineering Construction or generate 6.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KEPCO Engineering Construction vs. Tuksu Engineering Construction
Performance |
| Timeline |
| KEPCO Engineering |
| Tuksu Engineering |
KEPCO Engineering and Tuksu Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KEPCO Engineering and Tuksu Engineering
The main advantage of trading using opposite KEPCO Engineering and Tuksu Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KEPCO Engineering position performs unexpectedly, Tuksu Engineering 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 Tuksu Engineering will offset losses from the drop in Tuksu Engineering's long position.| KEPCO Engineering vs. Aprogen Healthcare Games | KEPCO Engineering vs. Samlip General Foods | KEPCO Engineering vs. Daekyung Machinery Engineering | KEPCO Engineering vs. Dongbang Ship Machinery |
| Tuksu Engineering vs. Jin Air Co | Tuksu Engineering vs. Jeil Steel Mfg | Tuksu Engineering vs. Lotte Non Life Insurance | Tuksu Engineering 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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