Correlation Between Kukil Metal and IQuest
Can any of the company-specific risk be diversified away by investing in both Kukil Metal and IQuest 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 IQuest 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 IQuest Co, you can compare the effects of market volatilities on Kukil Metal and IQuest 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 IQuest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukil Metal and IQuest.
Diversification Opportunities for Kukil Metal and IQuest
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kukil and IQuest is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Kukil Metal Co and IQuest Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQuest 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 IQuest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQuest has no effect on the direction of Kukil Metal i.e., Kukil Metal and IQuest go up and down completely randomly.
Pair Corralation between Kukil Metal and IQuest
Assuming the 90 days trading horizon Kukil Metal Co is expected to under-perform the IQuest. But the stock apears to be less risky and, when comparing its historical volatility, Kukil Metal Co is 1.34 times less risky than IQuest. The stock trades about -0.04 of its potential returns per unit of risk. The IQuest Co is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 242,500 in IQuest Co on November 10, 2024 and sell it today you would earn a total of 19,000 from holding IQuest Co or generate 7.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukil Metal Co vs. IQuest Co
Performance |
| Timeline |
| Kukil Metal |
| IQuest |
Kukil Metal and IQuest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukil Metal and IQuest
The main advantage of trading using opposite Kukil Metal and IQuest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukil Metal position performs unexpectedly, IQuest 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 IQuest will offset losses from the drop in IQuest's long position.| Kukil Metal vs. Daishin Information Communications | Kukil Metal vs. Digital Power Communications | Kukil Metal vs. Daewoo Engineering Construction | Kukil Metal vs. Nice Information Telecommunication |
| IQuest vs. Hanjin Transportation Co | IQuest vs. Leaders Technology Investment | IQuest vs. LB Investment | IQuest vs. NH Investment Securities |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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