Correlation Between Korea New and KBSTAR 200TR
Can any of the company-specific risk be diversified away by investing in both Korea New and KBSTAR 200TR 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 New and KBSTAR 200TR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea New Network and KBSTAR 200TR, you can compare the effects of market volatilities on Korea New and KBSTAR 200TR 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 New with a short position of KBSTAR 200TR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea New and KBSTAR 200TR.
Diversification Opportunities for Korea New and KBSTAR 200TR
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Korea and KBSTAR is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Korea New Network and KBSTAR 200TR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KBSTAR 200TR and Korea New 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 New Network are associated (or correlated) with KBSTAR 200TR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KBSTAR 200TR has no effect on the direction of Korea New i.e., Korea New and KBSTAR 200TR go up and down completely randomly.
Pair Corralation between Korea New and KBSTAR 200TR
Assuming the 90 days trading horizon Korea New Network is expected to generate 1.95 times more return on investment than KBSTAR 200TR. However, Korea New is 1.95 times more volatile than KBSTAR 200TR. It trades about 0.08 of its potential returns per unit of risk. KBSTAR 200TR is currently generating about -0.19 per unit of risk. If you would invest 76,400 in Korea New Network on August 24, 2024 and sell it today you would earn a total of 2,800 from holding Korea New Network or generate 3.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea New Network vs. KBSTAR 200TR
Performance |
| Timeline |
| Korea New Network |
| KBSTAR 200TR |
Korea New and KBSTAR 200TR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea New and KBSTAR 200TR
The main advantage of trading using opposite Korea New and KBSTAR 200TR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea New position performs unexpectedly, KBSTAR 200TR 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 KBSTAR 200TR will offset losses from the drop in KBSTAR 200TR's long position.| Korea New vs. Youngchang Chemical Co | Korea New vs. Display Tech Co | Korea New vs. Sewoon Medical Co | Korea New vs. LG Display Co |
| KBSTAR 200TR vs. Busan Industrial Co | KBSTAR 200TR vs. Busan Ind | KBSTAR 200TR vs. Shinhan WTI Futures | KBSTAR 200TR vs. UNISEM 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |