Correlation Between GAMEVIL and Busan Industrial
Can any of the company-specific risk be diversified away by investing in both GAMEVIL and Busan Industrial 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 GAMEVIL and Busan Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GAMEVIL and Busan Industrial Co, you can compare the effects of market volatilities on GAMEVIL and Busan Industrial 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 GAMEVIL with a short position of Busan Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMEVIL and Busan Industrial.
Diversification Opportunities for GAMEVIL and Busan Industrial
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GAMEVIL and Busan is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding GAMEVIL and Busan Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Busan Industrial and GAMEVIL 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 GAMEVIL are associated (or correlated) with Busan Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Busan Industrial has no effect on the direction of GAMEVIL i.e., GAMEVIL and Busan Industrial go up and down completely randomly.
Pair Corralation between GAMEVIL and Busan Industrial
Assuming the 90 days trading horizon GAMEVIL is expected to under-perform the Busan Industrial. In addition to that, GAMEVIL is 1.03 times more volatile than Busan Industrial Co. It trades about -0.22 of its total potential returns per unit of risk. Busan Industrial Co is currently generating about -0.01 per unit of volatility. If you would invest 7,790,000 in Busan Industrial Co on November 4, 2024 and sell it today you would lose (90,000) from holding Busan Industrial Co or give up 1.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GAMEVIL vs. Busan Industrial Co
Performance |
| Timeline |
| GAMEVIL |
| Busan Industrial |
GAMEVIL and Busan Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GAMEVIL and Busan Industrial
The main advantage of trading using opposite GAMEVIL and Busan Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GAMEVIL position performs unexpectedly, Busan Industrial 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 Industrial will offset losses from the drop in Busan Industrial's long position.The idea behind GAMEVIL and Busan Industrial Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Busan Industrial vs. Leaders Technology Investment | Busan Industrial vs. Korea Investment Holdings | Busan Industrial vs. Golden Bridge Investment | Busan Industrial vs. Sangsangin 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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