Correlation Between Homecast CoLtd and Korea Air
Can any of the company-specific risk be diversified away by investing in both Homecast CoLtd and Korea Air 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 Homecast CoLtd and Korea Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Homecast CoLtd and Korea Air Svc, you can compare the effects of market volatilities on Homecast CoLtd and Korea Air 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 Homecast CoLtd with a short position of Korea Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Homecast CoLtd and Korea Air.
Diversification Opportunities for Homecast CoLtd and Korea Air
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Homecast and Korea is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Homecast CoLtd and Korea Air Svc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Air Svc and Homecast CoLtd 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 Homecast CoLtd are associated (or correlated) with Korea Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Air Svc has no effect on the direction of Homecast CoLtd i.e., Homecast CoLtd and Korea Air go up and down completely randomly.
Pair Corralation between Homecast CoLtd and Korea Air
Assuming the 90 days trading horizon Homecast CoLtd is expected to under-perform the Korea Air. In addition to that, Homecast CoLtd is 1.65 times more volatile than Korea Air Svc. It trades about -0.1 of its total potential returns per unit of risk. Korea Air Svc is currently generating about -0.13 per unit of volatility. If you would invest 5,650,000 in Korea Air Svc on October 28, 2024 and sell it today you would lose (250,000) from holding Korea Air Svc or give up 4.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Homecast CoLtd vs. Korea Air Svc
Performance |
| Timeline |
| Homecast CoLtd |
| Korea Air Svc |
Homecast CoLtd and Korea Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Homecast CoLtd and Korea Air
The main advantage of trading using opposite Homecast CoLtd and Korea Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Homecast CoLtd position performs unexpectedly, Korea Air 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 Korea Air will offset losses from the drop in Korea Air's long position.| Homecast CoLtd vs. Samsung Electronics Co | Homecast CoLtd vs. Samsung Electronics Co | Homecast CoLtd vs. SK Hynix | Homecast CoLtd vs. HMM Co |
| Korea Air vs. Samsung Electronics Co | Korea Air vs. Samsung Electronics Co | Korea Air vs. KB Financial Group | Korea Air vs. Shinhan Financial Group |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |