Correlation Between Kukil Metal and Busan Ind
Can any of the company-specific risk be diversified away by investing in both Kukil Metal and Busan Ind 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 Kukil Metal and Busan Ind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kukil Metal Co and Busan Ind, you can compare the effects of market volatilities on Kukil Metal and Busan Ind 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 Kukil Metal with a short position of Busan Ind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukil Metal and Busan Ind.
Diversification Opportunities for Kukil Metal and Busan Ind
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kukil and Busan is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Kukil Metal Co and Busan Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Busan Ind and Kukil Metal 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 Kukil Metal Co are associated (or correlated) with Busan Ind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Busan Ind has no effect on the direction of Kukil Metal i.e., Kukil Metal and Busan Ind go up and down completely randomly.
Pair Corralation between Kukil Metal and Busan Ind
Assuming the 90 days trading horizon Kukil Metal Co is expected to generate 0.31 times more return on investment than Busan Ind. However, Kukil Metal Co is 3.19 times less risky than Busan Ind. It trades about -0.08 of its potential returns per unit of risk. Busan Ind is currently generating about -0.15 per unit of risk. If you would invest 176,900 in Kukil Metal Co on November 6, 2024 and sell it today you would lose (2,700) from holding Kukil Metal Co or give up 1.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukil Metal Co vs. Busan Ind
Performance |
| Timeline |
| Kukil Metal |
| Busan Ind |
Kukil Metal and Busan Ind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukil Metal and Busan Ind
The main advantage of trading using opposite Kukil Metal and Busan Ind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukil Metal position performs unexpectedly, Busan Ind 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 Busan Ind will offset losses from the drop in Busan Ind's long position.| Kukil Metal vs. Golden Bridge Investment | Kukil Metal vs. TJ media Co | Kukil Metal vs. Worldex Industry Trading | Kukil Metal vs. E Investment Development |
| Busan Ind vs. Sewoon Medical Co | Busan Ind vs. KTB Investment Securities | Busan Ind vs. E Investment Development | Busan Ind vs. Korean Drug 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..
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