Correlation Between KT Submarine and Jeju Beer
Can any of the company-specific risk be diversified away by investing in both KT Submarine and Jeju Beer 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 Jeju Beer 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 Jeju Beer Co, you can compare the effects of market volatilities on KT Submarine and Jeju Beer 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 Jeju Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of KT Submarine and Jeju Beer.
Diversification Opportunities for KT Submarine and Jeju Beer
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 060370 and Jeju is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding KT Submarine Telecom and Jeju Beer Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeju Beer 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 Jeju Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeju Beer has no effect on the direction of KT Submarine i.e., KT Submarine and Jeju Beer go up and down completely randomly.
Pair Corralation between KT Submarine and Jeju Beer
Assuming the 90 days trading horizon KT Submarine Telecom is expected to generate 1.37 times more return on investment than Jeju Beer. However, KT Submarine is 1.37 times more volatile than Jeju Beer Co. It trades about 0.18 of its potential returns per unit of risk. Jeju Beer Co is currently generating about -0.35 per unit of risk. If you would invest 1,550,000 in KT Submarine Telecom on November 3, 2024 and sell it today you would earn a total of 137,000 from holding KT Submarine Telecom or generate 8.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KT Submarine Telecom vs. Jeju Beer Co
Performance |
| Timeline |
| KT Submarine Telecom |
| Jeju Beer |
KT Submarine and Jeju Beer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KT Submarine and Jeju Beer
The main advantage of trading using opposite KT Submarine and Jeju Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KT Submarine position performs unexpectedly, Jeju Beer 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 Jeju Beer will offset losses from the drop in Jeju Beer's long position.| KT Submarine vs. PlayD Co | KT Submarine vs. Korea Petro Chemical | KT Submarine vs. Kukdong Oil Chemicals | KT Submarine vs. Kukdo Chemical Co |
| Jeju Beer vs. Nh Investment And | Jeju Beer vs. Innowireless Co | Jeju Beer vs. FOODWELL Co | Jeju Beer vs. Foodnamoo |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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