Correlation Between Wonbang Tech and LEENO Industrial
Can any of the company-specific risk be diversified away by investing in both Wonbang Tech and LEENO Industrial 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 LEENO Industrial 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 LEENO Industrial, you can compare the effects of market volatilities on Wonbang Tech and LEENO Industrial 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 LEENO Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonbang Tech and LEENO Industrial.
Diversification Opportunities for Wonbang Tech and LEENO Industrial
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wonbang and LEENO is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Wonbang Tech Co and LEENO Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEENO Industrial 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 LEENO Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEENO Industrial has no effect on the direction of Wonbang Tech i.e., Wonbang Tech and LEENO Industrial go up and down completely randomly.
Pair Corralation between Wonbang Tech and LEENO Industrial
Assuming the 90 days trading horizon Wonbang Tech Co is expected to generate 1.36 times more return on investment than LEENO Industrial. However, Wonbang Tech is 1.36 times more volatile than LEENO Industrial. It trades about 0.04 of its potential returns per unit of risk. LEENO Industrial is currently generating about 0.02 per unit of risk. If you would invest 865,060 in Wonbang Tech Co on August 30, 2024 and sell it today you would earn a total of 480,940 from holding Wonbang Tech Co or generate 55.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wonbang Tech Co vs. LEENO Industrial
Performance |
| Timeline |
| Wonbang Tech |
| LEENO Industrial |
Wonbang Tech and LEENO Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonbang Tech and LEENO Industrial
The main advantage of trading using opposite Wonbang Tech and LEENO Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonbang Tech position performs unexpectedly, LEENO Industrial 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 LEENO Industrial will offset losses from the drop in LEENO Industrial's long position.| Wonbang Tech vs. Green Cross Medical | Wonbang Tech vs. Choil Aluminum | Wonbang Tech vs. Duksan Hi Metal | Wonbang Tech vs. Dongil Metal Co |
| LEENO Industrial vs. Daou Data Corp | LEENO Industrial vs. Busan Industrial Co | LEENO Industrial vs. Busan Ind | LEENO Industrial vs. Shinhan WTI Futures |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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