Correlation Between Korea Computer and TJ Media
Can any of the company-specific risk be diversified away by investing in both Korea Computer and TJ Media 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 Korea Computer and TJ Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Computer and TJ media Co, you can compare the effects of market volatilities on Korea Computer and TJ Media 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 Korea Computer with a short position of TJ Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Computer and TJ Media.
Diversification Opportunities for Korea Computer and TJ Media
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Korea and 032540 is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Korea Computer and TJ media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TJ media and Korea Computer 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 Korea Computer are associated (or correlated) with TJ Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TJ media has no effect on the direction of Korea Computer i.e., Korea Computer and TJ Media go up and down completely randomly.
Pair Corralation between Korea Computer and TJ Media
Assuming the 90 days trading horizon Korea Computer is expected to generate 1.74 times more return on investment than TJ Media. However, Korea Computer is 1.74 times more volatile than TJ media Co. It trades about 0.03 of its potential returns per unit of risk. TJ media Co is currently generating about -0.03 per unit of risk. If you would invest 373,436 in Korea Computer on January 23, 2025 and sell it today you would earn a total of 94,564 from holding Korea Computer or generate 25.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Computer vs. TJ media Co
Performance |
| Timeline |
| Korea Computer |
| TJ media |
Korea Computer and TJ Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Computer and TJ Media
The main advantage of trading using opposite Korea Computer and TJ Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Computer position performs unexpectedly, TJ Media 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 TJ Media will offset losses from the drop in TJ Media's long position.| Korea Computer vs. Intellian Technologies | Korea Computer vs. Innowireless Co | Korea Computer vs. Hanyang Digitech Co | Korea Computer vs. Ajusteel Co |
| TJ Media vs. AptaBio Therapeutics | TJ Media vs. Daewoo SBI SPAC | TJ Media vs. Dream Security co | TJ Media vs. Microfriend |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |