Correlation Between KT Submarine and PNC Technologies
Can any of the company-specific risk be diversified away by investing in both KT Submarine and PNC Technologies 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 KT Submarine and PNC Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KT Submarine Telecom and PNC Technologies co, you can compare the effects of market volatilities on KT Submarine and PNC Technologies 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 KT Submarine with a short position of PNC Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of KT Submarine and PNC Technologies.
Diversification Opportunities for KT Submarine and PNC Technologies
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 060370 and PNC is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding KT Submarine Telecom and PNC Technologies co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PNC Technologies and KT Submarine 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 KT Submarine Telecom are associated (or correlated) with PNC Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PNC Technologies has no effect on the direction of KT Submarine i.e., KT Submarine and PNC Technologies go up and down completely randomly.
Pair Corralation between KT Submarine and PNC Technologies
Assuming the 90 days trading horizon KT Submarine Telecom is expected to generate 1.47 times more return on investment than PNC Technologies. However, KT Submarine is 1.47 times more volatile than PNC Technologies co. It trades about 0.08 of its potential returns per unit of risk. PNC Technologies co is currently generating about -0.01 per unit of risk. If you would invest 553,000 in KT Submarine Telecom on November 7, 2024 and sell it today you would earn a total of 1,154,000 from holding KT Submarine Telecom or generate 208.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.18% |
| Values | Daily Returns |
KT Submarine Telecom vs. PNC Technologies co
Performance |
| Timeline |
| KT Submarine Telecom |
| PNC Technologies |
KT Submarine and PNC Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KT Submarine and PNC Technologies
The main advantage of trading using opposite KT Submarine and PNC Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KT Submarine position performs unexpectedly, PNC Technologies 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 PNC Technologies will offset losses from the drop in PNC Technologies' long position.| KT Submarine vs. Samlip General Foods | KT Submarine vs. SAMG Entertainment Co | KT Submarine vs. Sempio Foods Co | KT Submarine vs. DC Media Co |
| PNC Technologies vs. DB Financial Investment | PNC Technologies vs. Korean Reinsurance Co | PNC Technologies vs. KakaoBank Corp | PNC Technologies vs. Digital Power Communications |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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