Correlation Between Wonbang Tech and NEXTIN
Can any of the company-specific risk be diversified away by investing in both Wonbang Tech and NEXTIN 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 Wonbang Tech and NEXTIN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wonbang Tech Co and NEXTIN Inc, you can compare the effects of market volatilities on Wonbang Tech and NEXTIN 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 Wonbang Tech with a short position of NEXTIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonbang Tech and NEXTIN.
Diversification Opportunities for Wonbang Tech and NEXTIN
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wonbang and NEXTIN is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Wonbang Tech Co and NEXTIN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXTIN Inc and Wonbang Tech 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 Wonbang Tech Co are associated (or correlated) with NEXTIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXTIN Inc has no effect on the direction of Wonbang Tech i.e., Wonbang Tech and NEXTIN go up and down completely randomly.
Pair Corralation between Wonbang Tech and NEXTIN
Assuming the 90 days trading horizon Wonbang Tech Co is expected to generate 0.94 times more return on investment than NEXTIN. However, Wonbang Tech Co is 1.06 times less risky than NEXTIN. It trades about -0.18 of its potential returns per unit of risk. NEXTIN Inc is currently generating about -0.28 per unit of risk. If you would invest 1,568,000 in Wonbang Tech Co on August 29, 2024 and sell it today you would lose (173,000) from holding Wonbang Tech Co or give up 11.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wonbang Tech Co vs. NEXTIN Inc
Performance |
| Timeline |
| Wonbang Tech |
| NEXTIN Inc |
Wonbang Tech and NEXTIN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonbang Tech and NEXTIN
The main advantage of trading using opposite Wonbang Tech and NEXTIN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonbang Tech position performs unexpectedly, NEXTIN 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 NEXTIN will offset losses from the drop in NEXTIN's long position.| Wonbang Tech vs. Samsung Electronics Co | Wonbang Tech vs. Samsung Electronics Co | Wonbang Tech vs. LG Energy Solution | Wonbang Tech vs. SK Hynix |
| NEXTIN vs. Parksystems Corp | NEXTIN vs. LEENO Industrial | NEXTIN vs. Tesna Inc | NEXTIN vs. Tokai Carbon Korea |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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