Correlation Between Wonbang Tech and Coloray International
Can any of the company-specific risk be diversified away by investing in both Wonbang Tech and Coloray International 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 Coloray International 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 Coloray International Investment, you can compare the effects of market volatilities on Wonbang Tech and Coloray International 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 Coloray International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonbang Tech and Coloray International.
Diversification Opportunities for Wonbang Tech and Coloray International
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wonbang and Coloray is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Wonbang Tech Co and Coloray International Investme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coloray International 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 Coloray International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coloray International has no effect on the direction of Wonbang Tech i.e., Wonbang Tech and Coloray International go up and down completely randomly.
Pair Corralation between Wonbang Tech and Coloray International
Assuming the 90 days trading horizon Wonbang Tech Co is expected to generate 1.64 times more return on investment than Coloray International. However, Wonbang Tech is 1.64 times more volatile than Coloray International Investment. It trades about 0.03 of its potential returns per unit of risk. Coloray International Investment is currently generating about -0.06 per unit of risk. If you would invest 1,213,584 in Wonbang Tech Co on August 28, 2024 and sell it today you would earn a total of 188,416 from holding Wonbang Tech Co or generate 15.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wonbang Tech Co vs. Coloray International Investme
Performance |
| Timeline |
| Wonbang Tech |
| Coloray International |
Wonbang Tech and Coloray International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonbang Tech and Coloray International
The main advantage of trading using opposite Wonbang Tech and Coloray International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonbang Tech position performs unexpectedly, Coloray International 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 Coloray International will offset losses from the drop in Coloray International's long position.| Wonbang Tech vs. Lotte Non Life Insurance | Wonbang Tech vs. InfoBank | Wonbang Tech vs. Heungkuk Metaltech CoLtd | Wonbang Tech vs. Total Soft Bank |
| Coloray International vs. Hanjin Transportation Co | Coloray International vs. Daiyang Metal Co | Coloray International vs. Heungkuk Metaltech CoLtd | Coloray International vs. DONGKUK TED METAL |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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